Payment Institution license
in UK

Payment institution UK and other types of licenses play a key role in providing various services and ensuring secure financial transactions. Financial market participants can obtain various regulatory documents in Europe for the legal activities of their company. If you are planning to launch a fintech project and go through the licensing procedure in the UK, experts from SBSB Fintech Lawyers will tell you in detail about the main requirements of the regulator and the features of obtaining a payment license in this jurisdiction.

Who Needs Payment Institution License UK

The Financial Conduct Authority (FCA) is responsible for supervising payment service providers and the licensing process in the UK. The regulator issues several types of payment institution licenses (PI):

• PI (Payment Institution) or API (Authorised Payment Institution) are considered full licenses and allows the licensee to provide a range of financial intermediary services in the field of online payments, related to transfers, deposits, exchanges, or withdrawals of money, as well as card issuing and acquiring;
• Small PI (Small Payment Institution) can be obtained by small companies if it is planned that the size of their finance transactions will not exceed €3 million per month. An important difference of this regulatory document is that there are no requirements for the size of the share capital when obtaining it.

If you need help choosing the optimal license for your payment organization, we recommend contacting the SBSB experts. They will advise you on all the questions of interest and take on the solution of all legal issues.

Such a payment solution should be chosen for projects whose clients reside in the UK. Upon the successful licensing procedure in the given jurisdiction, the geography of service provision can be expanded to Gibraltar (this option is not available for the Small PI variant).

How to Obtain UK Payment Institution License

Obtaining a license for payment services includes several stages. The potential licensee needs to:

• open a physical office in the jurisdiction;
• prepare a detailed business plan and financial forecast for 3 years;
• collect a package of documents on the organization’s structure, its beneficiaries, and shareholders;
• develop and implement policies and internal procedures (AML and KYC policies, risk management, management mechanisms, IT security, etc.). All measures should be aimed at the security of users, ensuring the confidentiality of their data, and protecting the platform to prevent money laundering;
• pay the registration fee and share capital (the amount of payment in both cases depends on the type of license chosen);
• hire two resident directors to the company’s staff, one of whom must perform the duties of a compliance officer. Directors must not have convictions for financial crimes;
• develop your own IT system for payment solutions.

After filling out special forms, the application and document package are submitted directly. FCA employees check the submitted information and ask clarifying questions if needed. This process can take 3 months and more. If the data is submitted in the required volume and corresponds to reality, the regulator makes a positive decision on issuing the license.

Cost of PI license in UK

The price depends on several factors, including the type of license chosen and a number of additional services. For more accurate information on the cost of your project, contact the SBSB team!

Why you should contact SBSB Fintech Lawyers 

If you are interested in obtaining a license for payment services “turnkey”, it is better to turn to professionals for help. SBSB specialists will help you register a company and solve all legal issues related to the licensing procedure. We take into account the features of each project and customer preferences, so we offer optimal solutions taking into account the requirements of regulatory bodies in the chosen jurisdiction. Our experts provide full legal support in preparing documents and after launching the business.