What is EMI bank account

Published:
January 4, 2023
What is EMI bank account

Obtaining an EMI account in the UK is an attractive option for those wishing to perform electronic defrayments in Europe. An Electronic Money Institution (EMI) is a financial institution authorized to participate in online payment services. The Financial Conduct Authority (FCA) regulates electronic money institutions in the UK.

If you are looking to enter the European market for an electronic money institution, you may want to consider the United Kingdom. It should be noted that the issuance of an E-money license in the UK gives its holder the right to provide services throughout the European Economic Area (EEA) through passportization without the need to go through a further licensing process in any of its member states.

Characteristics of electronic money

Before obtaining an e-money license in England, it will be useful for you to know that electronic money can be considered as a digital form of cash, since they have many similar properties. In other words, it is a monetary value that:

  • Stored electronically.
  • Used for making payment transactions.
  • Accepted by an individual or legal entity that is not an electronic money issuer.

It should be noted that electronic money is different from crypto. While the former are the electronically stored monetary value of fiat currencies controlled by central banking systems, e-currencies are non-cash assets such as bitcoin or litecoin that use decentralized governance.

Obtaining an EMI license in the United Kingdom

Any company in the UK that intends to create and distribute electronic money must apply for an UK EMI license. Therefore, the electronic money issuer must apply for registration or authorization.

In order to obtain a license for electronic money in the UK, a company can submit two types of official request:

  1. Small EMI resolution (Small EMI or SEMI)

Also, if you expect your business to not exceed an average of EUR 5 million outstanding e-money and do not plan to provide payment services in the EEA, then registration as a SEMI in the United Kingdom is available to you.

As well, you can provide unrelated payment services that do not arise directly from the use of your e-money, if the monthly turnover of payment transactions is less than 3 million EUR.

  1. authorized EMI United Kingdom (AEMI)

If you are going to generate more than EUR 5 million outstanding e-money or would like to obtain a license to provide payment services in the EEA, then you can apply for a UK AEMI license.

The passport will allow your chosen partners and agents in the EEA to provide the same authorized financial services for which your firm has been licensed.

Benefits of an EMI account in the United Kingdom

Online banking can help large businesses reduce losses when performing banking services, as well as when making transfers, mainly made in US dollars. We should not forget that such a financial institution itself controls money laundering. In addition, they provide a number of other features, which include:

  • The right to make payments to any other banks, including foreign ones, in many currencies;
  • Remote opening of accounts;
  • The right to link your own MasterCard cards to open accounts;
  • The right to accept payments made in the SWIFT system;
  • Possibility to open correspondent accounts all over the world;
  • Independently make decisions on opening accounts, making all kinds of payments.

Applying for an EMI license in United Kingdom: key features

Electronic money (e-money) is a relatively new payment instrument that has emerged with the development of technology. Their popularity is due to a number of factors, including the growing difficulties in opening current accounts and receiving payment cards in traditional retail banks, the rapid development of digital technologies. Electronic money satisfies the different needs of different customer groups.

If you are interested in obtaining a United Kingdom EMI license, please note that electronic money institutions offer a wide range of payment processing and alternative banking products, services and solutions, ranging from merchant accounts and international money transfers to high-end payment cards and private banking for corporate clients. Due to simplified regulatory requirements, these institutions provide their products and services at reduced prices compared to banks and use simpler onboarding procedures. Some of the most popular products/services offered by EMI UK are listed below:

  • Personal and business accounts with IBAN;
  • Payment cards;
  • Money transfers;
  • Digital currency transactions;
  • Trade service;
  • SEPA payments.

Characteristics of electronic money

Before obtaining an e-money license in England, it will be useful for you to know that electronic money can be considered as a digital form of cash, since they have many similar properties. In other words, it is a monetary value that:

  • Stored electronically.
  • Used for making payment transactions.
  • Accepted by an individual or legal entity that is not an electronic money issuer.

It should be noted that electronic money is different from cryptocurrencies. While the former are the electronically stored monetary value of fiat currencies controlled by central banking systems, crypto money are non-cash assets such as bitcoin or litecoin that use decentralized governance.

Requirements for obtaining an EMI license in the UK

The prospective EMI license holder must fulfill the following conditions:

  • Open a bank account in the United Kingdom for personal or corporate purposes.
  • Have available authorized capital on the account.
  • Submit proof of income (e.g. tax return).
  • Acquire (conclude a long-term lease agreement) real estate for the company.
  • Terms of obtaining an EMI license in England
  • The FCA must make a decision within 3 months of receiving a complete application. If the Regulator requests additional information, the request will be approved within 12 months.

Also, if you wish to register as an e-money institution in England, please note that you will need to open a bank account with a UK bank. Accounts can be opened at any banking institution. In addition to the above, the account must be a savings account.

How to get an e-money license in Britain?

To apply for an EMI license in the UK, it is worth first requesting an appointment with a subject matter expert who will review your business plan and resources and provide their expert opinion and recommendations. In the future, the consultant will provide support in preparing the necessary documents for obtaining an EMI license in the UK.

If you are interested in this material or want to open a banking institution in the UK, you can contact IQ Decision UK representatives and order a consultation on the regulation of financial activities in the United Kingdom.

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