Application for authorization to act as the national payment institution

We advised the small payment institution on the following project:

APPLICATION OF THE SMALL PAYMENT INSTITUTION FOR AUTHORIZATION TO ACT AS THE NATIONAL PAYMENT INSTITUTION

• For many startups that are planning business models including the provision of payment services, but want to avoid – at least in the initial phase – the need to obtain a license as the national payment institution, one of the options is to register as the small payment institution. Obtaining the status of the small payment institution allows the institution to provide payment services with the exception of PIS and AIS and subject to certain restrictions in the regulations.
• First of all, in the case of the small payment institution, the total amount of funds accepted for a single user at any time may not exceed the equivalent in Polish currency of EUR 2,000.
• Second of all, when the statutory limits of executed transactions are exceeded, it is essential to report this fact to the PFSA within 14 days.
• Third of all, the Payment Services Act stipulates that the average of the total amount of payment transactions in the previous 12 months performed by the small payment institution, including the agents through which it renders payment services, must not exceed an amount equivalent to EUR 1,500,000 per month. If the aforementioned threshold is exceeded, the small payment institution, regardless of any notification obligation, is obliged to adjust the size of its operations to the statutory requirements or apply for an authorization to provide payment services as the national payment institution within 30 days from the end of the period in which the excess occurred.
• In practice, it means that small payment institutions need to monitor their transactions on an ongoing basis so that they may prepare well in advance and submit within the statutory deadline an application for the authorization to act as the national payment institution.

The advisory services of DLK Legal included:

• preparation of the small payment institution application for authorization to provide all payment services as the national payment institution, including PIS and AIS, as required by the Payment Services Act and secondary legislation,
• development and operationalization of internal documentation applicable to the national payment institution, as required by the Payment Services Act and secondary legislation (including operating and financial plan, security policy, anti-money laundering and terrorist financing procedure, incident management procedure),
• filing of the application within the statutory deadline and representation of the applicant in the licensing proceedings before the PFSA.