To obtain a payment operator's licence in Lithuania

28.08.2023

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Introduction

A payment operator licence in Lithuania plays an important role in ensuring the legality and security of financial transactions. It implies strict control by regulators and mandatory compliance with rules, regulations and standards. Obtaining such a licence confirms that the company meets high standards in the field of financial services and is ready to ensure reliability and security for its customers and partners.

Meaning of a payment operator's licence
A payment operator licence is an official permit issued by a country's regulatory authorities to carry out payment transactions and provide related financial services. In the case of Lithuania, it authorises companies to carry out a variety of electronic payments, issue electronic money, process transactions and many other financial activities.
Advantages of obtaining a licence in Lithuania

Opening a payment operator licence in Lithuania offers many advantages that contribute to the successful development of fintech business:

Favourable regulation of the financial sector: Lithuania is renowned for its open and innovative regulation of the financial sector. Supervisory authorities actively support fintech development and provide a flexible regulatory framework for startups and innovative projects. This creates a unique environment that fosters innovation in payment services.
International advantages: Lithuania is part of the European Union and the eurozone, which provides access to a large domestic market and facilitates cross-border co-operation. This offers great opportunities for those wishing to open a business in the EU and expand operations outside Lithuania.
Geographical location and logistics: Geographical proximity to key European markets, including Scandinavia and Eastern Europe, makes Lithuania an attractive location for international businesses. Efficient logistics infrastructure facilitates fast and reliable delivery of goods and services.
Innovation environment: Lithuania actively supports innovation and technological progress. Many fintech startups and technology companies are developing in the country, which facilitates the exchange of knowledge and experience in financial technology.
Financial stability and trust: Favourable economic situation and high level of financial stability contribute to the creation of trust on the part of customers and investors. The issuance of a payment operator licence in Lithuania demonstrates the financial reliability and legality of the company's operations.

All these factors make Lithuania an attractive platform for the start-up and development of fintech businesses with the ability to provide payment services and financial innovations.

Positive financial policies

Lithuania is known for its positive and forward-thinking approach to financial industry regulation, making it a place of attraction for fintech projects. This nation has been quick to recognise the importance of technological innovation in finance and actively supports its progress.

Actions of the Supervision Service of the Bank of Lithuania (LB): An important detail of the positive policy is the active intervention of the Supervisory Service of the Bank of Lithuania. This supervisory authority has deep experience and authority in issuing licences to payment systems and registering fintech organisations in Lithuania. It gives companies a chance to obtain authorisation to provide a multitude of payment services, including electronic funds, funds transfers, payment procedures and other financial transactions.
Reducing licensing bureaucracy: Lithuania is working to make the licensing procedure as clear and open as possible for fintech companies. This means simple procedures, clear conditions and guidelines for applicants. This approach allows start-ups and businesses to focus on growth by entrusting licensing to specialists.
Innovation testing platforms: For those start-ups and corporations wishing to test their innovative solutions, Lithuania introduces the mechanism of "innovation sandboxes". This enables companies to test their products and services in a regulated environment, which accelerates their market launch.

As a result, favourable regulation in the financial domain provides the best prerequisites for launching fintech initiatives in Lithuania, helping them to grow and efficiently provide financial solutions.

Options for licensing of payment operators in Lithuania.

Licence for Payment Institutions (PI)

A payment institution licence in Lithuania is one of the main categories of permits for financial structures. This type of licence entitles organisations to provide a variety of financial services, making it a desirable choice for fintech organisations. Holders of such a licence can provide services in a variety of areas, including:

Issuance and management of payment methods: PI licence holders may issue payment instruments, such as credit cards, and process transactions using them.
Transfers and transactions: PI licence holders are authorised to carry out transfers of funds, including international transfers, and to carry out payment actions between accounts and customers.
Current and payment accounts: This licence also entitles the holder to provide current and payment account services, including cash transactions.

Licensing of a payment institution in Lithuania implies strict compliance with the established standards. But in return, it provides opportunities for various financial activities and business expansion in the payment and fintech sector.

Electronic Monetary Institutions (EMI) Licence

Obtaining an e-money licence in Lithuania is becoming key for companies wishing to provide e-money services. This authorisation enables the issuance, management and processing of electronic money, opening up a number of possibilities for handling customer payments and finances. Here are some of the main aspects of the EMI licence:

Issuance and management of electronic funds: A company with EMI licence can issue electronic money for various payment transactions.
Transactions and payments: EMI licence holders can provide transfer services both within and outside Lithuania.
Custody of customer funds: Companies with an EMI licence may also provide services for storing customer money on electronic platforms.

EMI licensing in Lithuania offers a wide range of opportunities for fintech innovation and business development in the field of electronic payments. It provides companies with modern and convenient mechanisms for working with finances, making the licence a valuable resource in the world of financial technology.

Drawing up documents and filing an application for registration of a fintech business in Lithuania

Preparation of a set of documents

№	Documents and Data	Description
1	Bylaws	A formal document that sets out the basic objectives, structure and operations of your fintech company.
2	Work programme	Contains information about the services offered, locations of services, and other details of running a fintech business in Lithuania.
3	Business strategy	Covers the expected budget for the next three fiscal years, confirming your company's financial strength and potential for productive operations.
4	Documents on the amount of authorised capital	Confirmation that the amount of the authorised capital meets the legal requirements.
5	Description of measures to safeguard cash	Describes approaches to safeguarding the funds of e-money holders and payment service customers.
6	Methods of management and control activities	Describes your approach to risk management, bookkeeping and other key aspects after procuring a remuneration permit in Lithuania.
7	Control strategies to prevent currency cleansing and the financing of criminal organisations	Details activities aimed at preventing fraudulent activities and ensuring the security of transactions.
8	Description of the procedure for monitoring and tracking incidents	Includes organising incident monitoring and measures to ensure safety.
9	Description of business continuity processes	Indicates how the business continuity of the company will be ensured.
10	Description of the principles of statistical data collection	Includes a description of the process for collecting activity, transaction and fraud data.
11	Description of the security policy	Detailed risk assessment and measures to mitigate safety-related risks.
12	Description of organisational arrangements	Includes the use of branches, agents and other details of organisational structure.
13	Information on managers	Name, surname, personal code and documents confirming the reputation, qualifications and experience of the directors of the company wishing to apply for a payment licence in Lithuania.
14	Payment data privacy programme	Description of procedures for submitting, monitoring, tracking and restricting access to sensitive payment data.
15	Documents and data on participants	Information on persons acquiring or holding shares in the company's authorised capital, as well as the size of their shares.
16	Information on the head of the branch	Name, surname and other details of the branch manager, if applicable.
17	Documents and data on the audit company or auditor	Credentials and details of the audit firm or auditor auditing the financial statements.
18	Documents and data confirming compliance with the requirements	Documents and data confirming compliance with the requirements of Article 20 of the Payment Institutions Act and confirming the amount of professional indemnity insurance or a comparable guarantee, if the applicant intends to provide payment initiation service and/or account information.
19	Location address	The address of the physical location of the company.

Preparing a set of documents is an important step in obtaining a payment system provider licence in Lithuania. Each document must be carefully prepared to meet the requirements of the regulator and demonstrate financial stability, operational efficiency and compliance with safety standards.

Contacting the Control Department of the Bank of Lithuania

In order to obtain a payment operator's licence in Lithuania, a number of steps must be passed under the supervision of the Control Department of the Bank of Lithuania:

Document Preparation: Before applying, it is important to prepare all necessary documents, paying attention to their compliance. Completeness, relevance and accuracy of the submitted information are important.
Electronic application: The application for a licence is submitted through the electronic portal of the Bank of Lithuania's Control Division. This method ensures fast and convenient communication with the supervisory authority.
Document verification: After the application, the supervisory authority analyses the company's activities and the information provided.
Correspondence with the Department: In the course of verification, questions may arise from the Control Department requiring clarification or provision of additional information.
Decision-making: Based on the analysis, the controlling authority decides whether to grant or refuse a licence. The decision is based on the compliance of the company's activities with the established requirements.
Timeframe for review: Usually it takes up to 3 months to review an application.
Informing about the decision: After the decision is made, the company is notified about the result of the decision. If the application is approved, the company receives the relevant licence.

Careful preparation and following the regulator's instructions are important for a successful procedure.

Financial stability when obtaining a fintech licence in Lithuania

Capital requirements and financial performance

The key point when applying for a payment operator licence in Lithuania is to prove the financial stability of the company. The control department of the Bank of Lithuania carefully considers this aspect, given its importance for the safe provision of services.

The charter capital requirements depend on the type of licence:

EMI licence: In order to obtain an EMI licence in Lithuania, a company must have a share capital of at least EUR 350,000. Under certain conditions, the minimum capital may not be required.
PI licence: For a PI licence, the minimum capital varies from EUR 20,000 to EUR 125,000.

Having sufficient capital and financial resources allows you not only to meet the requirements of the regulator, but also to build customer confidence in the reliability of your company as a payment operator.

Responsibilities in the domain of countering money laundering and backing of felonious syndicates

The implementation of anti-capital purification and anti-funding of criminal organisations is at the heart of the procedures for obtaining a payment operator's licence in Lithuania. The Supervision Service of the Bank of Lithuania pays special attention to this issue, as the goal is to guarantee the security of financial transactions.

Your responsibilities in this area include:

Internal rules and regulations: Your business should establish and enforce standards and rules that aim to identify and block questionable financial activity. Examples may include customer identification procedures, transaction surveillance, and setting limits on potentially questionable transactions.
Monitoring and reporting: To operate successfully in Lithuania's fintech sector, you need to implement systems that can automatically scan transactions for possible money laundering or financing of criminal organisations. If risky transactions are detected, the regulator must be notified.
Employee education programmes: Your employees, particularly those who interact with financial processes, need to be aware of how to detect and prevent attempts to launder money or finance criminal organisations. Their training will help them respond to potential threats in a timely manner.
Interaction with regulatory authorities: Your business in Lithuania should ensure open and productive interaction with regulatory authorities on anti-money laundering and anti-financing of criminal organisations.
Technical infrastructure: Your business should have state-of-the-art systems and tools to analyse customer data and transactions.
Compliance standards: You should create and regularly update documentation that reflects your AML/CFT strategy and actions.

Ultimately, your company should be prepared to demonstrate to the regulator a strong position on the safety and security of financial activities.

Ensuring payment data security for payment operators in Lithuania

Payment data security is a critical aspect for those wishing to register a payment operator's licence in Lithuania. Protecting customers' sensitive payment data is an integral part of a licensee's responsibilities. Here are some key measures that should be taken to ensure payment data security:

Payment data security measures	Description
Protection against unauthorised access	Implement authentication and authorisation mechanisms to ensure that only authorised individuals have access to payment data. May include the use of passwords, two-factor authentication and biometric methods.
Data encryption	Those wishing to obtain a payment licence in Lithuania must ensure that cryptographic methods are used to protect the transmission and storage of payment data. This helps to ensure confidentiality and integrity of information when it is transmitted through networks.
Monitoring and anomaly detection	Develop monitoring systems to detect anomalous or suspicious activity in payment transactions. This enables timely response to potential security incidents.
Regular audits and inspections	Conduct regular security audits to identify vulnerabilities and assess the effectiveness of security measures. It is also important to conduct penetration testing to verify the level of protection of systems.
Staff training	Starting a fintech company in Lithuania requires regular training of employees so that they understand the importance of data security and know how to properly handle sensitive information.
Compliance with safety standards	Compliance with international data security standards such as PCI DSS (Payment Card Data Security Standard) to ensure a high level of payment data security.

Ensuring the security of payment data is an important component of customer and partner trust, as well as a mandatory requirement of the regulator. An effective security system helps to prevent financial fraud, preserve the company's reputation and ensure compliance with data security standards.

Training and certification of personnel for opening a fintech company in Lithuania

Employee training in financial security and regulation

Requirement/Pitch	Details
Definition	Identify those employees who will handle financial transactions and payments.
Development of educational programme	Create a training programme that includes the area of financial security, rules and regulations.
Conducting training for employees	When starting a fintech business in Lithuania, organise training for selected employees, including lectures, practical exercises and testing.
Providing resources for self-learning	Provide access to materials and resources for self-study of financial security topics.
Assessment of employees' knowledge and skills	Conduct an assessment of employee knowledge and skills after the training is completed.
Регулярное обновление и дополнение программы обучения	Continue to improve the programme in line with changes in legislation and requirements.

Financial security and regulatory training for employees is an important step to ensure compliance and prevent potential violations.

Certification of personnel to work with financial transactions

The certification of personnel to work with financial transactions plays an important role in ensuring the reliability and safety of fintech businesses in Lithuania. The investor verification procedure at the Central Commission for Insurance and Supervision of the Lithuanian Financial Market (CCSSO) is an additional step that must be completed to ensure trust and compliance with the regulator's standards.

Here are the basic steps of this procedure:

1. Preparation of Documents:

Before starting the investor due diligence procedure, it is essential to prepare all the necessary documents. This may include founding documents, financial information, and other documents that may be requested by the regulator.

2. Submission of the Application:

The founder of the company submits an application for investor verification to the Lithuanian Central Commission for Insurance and Financial Market Supervision. The application may be submitted electronically or in writing as required by the regulator.

3. Verification and Analysis:

When conducting CCSSO in Lithuania, the regulator performs a thorough verification of the submitted documents and investor information. This comprises analysing the monetary position, enterprise reputation and other aspects.

4. Obtaining a Certificate:

In case of a favourable decision, the founder of the company receives an Investor Verification Certificate. This certificate confirms the investors' compliance with the regulator's standards and their admissibility to operate in the Lithuanian financial sector.

Investor certification in Lithuania is an important mechanism for ensuring integrity and transparency in financial activities. It ensures that persons with key influence over the company meet high standards of reliability and professionalism.

Duties and requirements after obtaining a payment licence in Lithuania

Duties and requirements	Description
Regular Reporting	The company is required to provide regular reports and information to the regulator according to a set schedule and format. This includes financial statements, customer and transaction data and other relevant information.
Combating Money Laundering and Financing of Criminal Organisations	The Company must strictly comply with all measures to prevent money laundering and the financing of criminal organisations. This includes establishing monitoring and reporting systems, conducting audits of customers and transactions, and complying with all regulations and requirements in this area.
Compliance with Safety Standards	After launching a business in Lithuania, the company is required to maintain a high level of security in all aspects of its operations. This includes securing customer payment data, protection against unauthorised access and cyber security measures.
Maintaining Professional Level	Employees of the company, especially those who work with financial transactions, should continuously improve their knowledge and skills in financial security, regulation and other relevant areas.
Interaction with the Regulator	After starting a business in Lithuania, the company must maintain open and active co-operation with the regulator. This includes providing requested information, co-operating with inspections and other activities, and complying with all requirements and instructions.

Need for qualified support when registering a payment operator's licence in Lithuania

Obtaining a payment operator licence in Lithuania is a step towards establishing a legal and reliable fintech business with access to international markets and customers. With its rich experience in financial regulation, favourable business environment and access to experts, Lithuania becomes an attractive place to develop your fintech company.

The process of opening a payment licence in Lithuania requires careful attention to detail and strict adherence to the requirements of the regulator. In this regard, qualified support of our experts with experience in the field of licensing of fintech companies in Lithuania will facilitate the start and development of your business.

To contact our specialists, please fill in the feedback form. We will provide detailed advice and full support in obtaining a payment operator licence in Lithuania.