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Regulating E-Money

Setting up an Electronic Money Institution in Cyprus

Licensing and supervision of Electronic Money Institutions


In Cyprus the provision of electronic payment services is regulated by the Provision and Use of Payment Services and Access to Payment Systems Law 31(I)/2018 of 2018 and the Electronic Money Law of 81(I)/2012 (the "Laws") as amended which transposed the EU Directive 2015/2366. The provision of electronic services in Cyprus can be provided by an Electronic Money Institution (the “EMI”) which has been granted an authorisation by the Central Bank of Cyprus (the “CBC”).


Electronic Payment Services:


1. Services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account.

2. Services enabling cash withdrawals from a payment account as well as the operations required for operating a payment account.

3. Execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider:

(a) execution of direct debits, including one-off direct debits,

(b) execution of payment transactions through a payment card or a similar device,

(c) execution of credit transfers, including standing orders.

4. Execution of payment transactions where the funds are covered by a credit line for a payment service user:

(a) execution of direct debits, including one-off direct debits,

(b) execution of payment transactions through a payment card or a similar device,

(c) execution of credit transfers, including standing orders.

5. Issuing and/or acquiring of payment transactions.

6. Money Remittance.

7. Execution of payment transactions where the consent of the payer to execute a payment transaction is given by means of any telecommunications, IT system or network operator, acting only as an intermediary between the payment service user and the supplier of the goods and services.

8. Account information services.

9. Issue electronic money.


Initial Capital of an EMI


The legal entity must maintain at the time of the authorisation an initial capital of at least Euro 350.000. Following the authorisation, the legal entity authorised to provide services regarding the issuance of electronic money shall be equal to 2% of the average value of electronic money in circulation


Application procedure and Timing

Once the business model has been decided on, the relevant application form and all ancillary documents must be submitted with the CBC. Once all the documents are prepared and submitted, the average time for authorisation will be 3 - 5 months.


Passporting Payment Services


Payment services may also be offered from or from within Cyprus by an authorised EU payment institution pursuant to the right of establishment and freedom to provide services, in accordance with the provisions set out in the Law. Once successfully licensed by the CBC, the EMI may passport its Electronic Payment Services to other EU Member States, following the procedure as set out in the Laws, but not outside the European Union.


How MPC can help?

  • Provide an initial advice on structure of the EMI and licensing activities in accordance with the Law.

  • Advice on composition of the Board of Directors in accordance with the requirements of the Laws and assistance in allocating relevant personnel if required.

  • Preparation of the constitutional documents and incorporation of the private limited company which will be licensed as an EMI.

  • Preparation of application to the CBC for obtaining a license as an EMI.

  • Provide Company Administration/Secretarial Services regarding corporate approvals and internal procedure of the company intending to apply for an EMI license.



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