Case study: Client support from EMI license to successful connection of a correspondent bank
Over the past decade, the EMI direction in the fintech industry has evolved at an impressive pace. This is primarily due to the growing popularity of online and mobile payments, as well as the development of technologies that enable financial companies to provide innovative financial services. It is also believed to be attractive due to the reduction of regulatory requirements for EMI in some jurisdictions.
The development of EMIs has enabled financial companies to offer a wide range of financial services previously available only to large banks.
The background
In 2021, we were approached by a client whose company provided financial technology services. In order to expand his business and increase his income, he decided to engage in electronic money activities, for which he needed a licence. The client did not know in which jurisdiction it would be more profitable for him to obtain an e-money licence, but since his company was focused on the European market, the jurisdiction had to be in Europe. In addition to obtaining the licence itself, the client also required assistance in connecting to a correspondent bank, without which it would be impossible to operate in the e-money sector.
Situation analysis
As the client initially had no idea where to obtain a financial licence, during the initial consultation we offered options for all European jurisdictions where this was possible. As a result, we concluded that Malta was the most appropriate jurisdiction. Firstly, this jurisdiction is a member of the European Union, so a licence obtained in Malta can be recognised in other EU countries. Secondly, Malta has a well-developed financial infrastructure, including a network of core banks. In addition, many are attracted to the jurisdiction because of its tax regime for financial companies.
After agreeing the jurisdiction, action plan and timeline with the client, we began the process of obtaining an EMI licence in Malta.
Why did the client choose us?
During the interview, the client informed us that we were not the only company they had approached with this request. But the choice was still in our favour.
“Yes, your offer was not the cheapest on the market, but that was not the main criterion for me. I looked at your approach to the problem first, and I really liked the way you approached it. During the first consultation, the manager himself mentioned the possibility of assistance in connecting a correspondent bank, which was important to me. To be honest, none of the other companies I have consulted have offered me an adequate solution to this particular request. In general, when connecting to a core bank was mentioned, the conversation was either moved on to another topic or they confirmed that they would help open an account for the company. After I clarified that it was a core bank account, they avoided answering, and it became clear that we were talking about an ordinary corporate account again. It was not suitable for me at all, and they would not be able to help me open a correspondent account,” said the client.
Our approach
The first step was a consultation, where we discussed the structure of the client's business and all aspects related to the characteristics of this project. This was followed by the process of obtaining a licence.
The first step in obtaining an e-money licence in Malta is to register a company, which was successfully done.
We then began to prepare the documents required to obtain an EMI licence. During this process, we assisted the client in the preparation of a business plan and provided advice on this matter, as well as advising on each of the required documents. The preparation of the documents took several months.
An important stage was to advise the client on the requirements of the regulator before submitting the documents to obtain an EMI licence. This helped to avoid mistakes in the preparation of the documents and to accelerate the process of obtaining the licence.
Once the documents had been submitted, we guided the client through the process of reviewing the licence application and provided support and advice on communicating with the regulator.
As for the connection of the correspondent bank, thanks to our successful plan and clear actions, the client did not have any problems in this matter and the correspondent bank was connected within several months without any unnecessary difficulties.
The result
After 11 months, the client's requirements were fully met:
Obtained EMI licence in European jurisdiction.
Correspondent bank connected.
The client, as desired, expanded his business and increased his income by providing services to citizens of various countries for the issuance and transfer of electronic money, the issuance of payment cards and other financial transactions.
An application for a residence permit in Malta, which arose during the process of obtaining an EMI licence, was also completed.
Outcome
The client was satisfied with our work, and we continued to work with him throughout, providing accounting and legal services to his business. And recently, he approached us with a new request: due to the rapid development of the cryptocurrency sector and its increasing role in the financial sector, the client also wanted to obtain a cryptocurrency licence. After agreeing on all the details, we have already started the process and soon our client's business will be able to reach a new level in the field of fintech.
Contact us if you need help in obtaining an EMI licence
We will select the most appropriate jurisdiction to obtain a financial licence.
We will guide you through all stages of the licensing process.
We will help you connect with a correspondent bank.
We will assist you in the further operation of your business.
Fill in the feedback form, send us a telegram or call us on the number listed in the “Contacts” section to request a consultation.