Obtaining an EMI License in the UK

An EMI license grants the right to operate with electronic money on a legal basis. This means that it allows the storage of client funds, execution of payments, and connection to banking and payment systems. Without it, no financial transaction is considered legal.

Of course, the process of obtaining a license is not the easiest. It is necessary to take into account the requirements for company structure, compliance, documentation, and more. If you are already considering this step, you likely have a clear vision of your product, understand the risks, and are ready to invest in a legal foundation for your business.

However, there are still many questions. Therefore, the AA Lawrange team will further explain everything related to the EMI license UK. A separate section will cover the option of purchasing a ready-made company with a license.

Understanding the EMI License

An EMI license is a regulatory status granting the right to issue electronic money and provide a full range of payment services within UK jurisdiction. It is issued by the Financial Conduct Authority (FCA) under the Electronic Money Regulations (2011) and Payment Services Regulations (2017).

The license covers the following capabilities:

1. Creation and maintenance of electronic wallets and prepaid cards.
2. Opening and servicing of payment accounts, i.e., receiving, storing, and transferring client funds.
3. Conducting transactional operations (transfers, direct debits, recurring payments, card or device payments).
4. Currency exchange related to electronic money.
5. Providing payment initiation services (PIS) and account information services (AIS).
6. Ensuring client fund protection through safeguarding mechanisms.

A UK EMI license is relevant for companies that wish to build their own payment infrastructure, work directly with clients, reduce dependence on third-party processors, and increase control over financial flows.

This type of license applies to fintech, e-commerce, retail, gaming, and money transfer services, and generally anywhere legal operations with electronic money and payment accounts are required.

Benefits of EMI Licensing in the UK

When choosing a jurisdiction for launching a financial product, it is essential not only to meet regulatory requirements but also to maintain business momentum. Access to banking, regulatory stability, and international reputation are factors that can either accelerate or block business at the start.

Does the United Kingdom provide licensed companies with a competitive environment? The key advantages of the jurisdiction include:

• Access to the UK financial market. The license allows direct work with banks, payment systems, clients, and partners in the UK without intermediaries.
• Stable regulatory framework. The FCA ensures clear requirements, transparent procedures, and predictability, allowing companies to plan their development without the risk of sudden regulatory changes.
• International reputation. London is one of the most influential financial centers in the world. Having a UK EMI license enhances the credibility of a company among investors, banks, and clients globally, especially in the B2B segment.
• Opportunity for global expansion. The UK has over 130 double taxation treaties, simplifying entry into other markets and reducing tax burdens for cross-border operations.
• Support for innovation. Companies developing fintech solutions can claim tax credits of up to 230% for R&D expenses, reducing costs and encouraging product development.
• Less regulatory uncertainty compared to the EU. After Brexit, the British regulatory model has remained stable, while changes are expected in the EU due to PSD3, including an increase in capital requirements. This makes the EMI license UK a more accessible and less burdensome alternative for many companies.
• Chance to obtain Visa/Mastercard membership. Having the license simplifies obtaining Principal Member status for card issuance — a critical factor for payment service providers.

These benefits are not theoretical — they form a set of features of obtaining an EMI financial license, which directly influence daily operations, partner negotiations, and time to market.

Categories of EMI Licenses

Within the framework of the Electronic Money Institution License in UK, two types of licensing are available:

1. Small Electronic Money Institution (SEMI).
2. Authorised Electronic Money Institution (AEMI).

The choice of license type primarily depends on the scale of business, transaction volume, and company goals. Both options are regulated by the FCA but differ in requirements, limitations, and responsibility levels. Below is a brief overview.

Small Electronic Money Institution (SEMI)

SEMI is a simplified form of the license that allows issuing electronic money and providing basic payment services, but with certain limitations.

Obtaining SEMI potentially allows for a faster market entry — with basic functionality and minimal regulatory burden. The format is suitable for small companies, early-stage MVP products, or local services.

Authorised ElectronicMoney Institution (AEMI)

AEMI is a full E-money license in UK that allows operating without limits on volumes and providing all types of payment services. It is most often chosen by businesses planning to scale, expand their international presence, and deeply integrate with banking infrastructure and payment systems at the Principal Member level.

If you want to obtain an authorized payment institution license in UK, be prepared for a comprehensive verification of shareholders, directors, and auditor, internal control structure, risk management system, fund protection mechanisms, and AML/CFT policies.

Regulatory Framework for EMI Companies

The EMI license differs fundamentally from a banking one. An electronic money issuer has no right to accept deposits or issue loans, but may provide payment services, open IBAN accounts, issue cards, and integrate into international infrastructure.

To obtain an EMI licence in UK, it is not enough to simply submit an application to the FCA. The company must comply with the requirements of several regulatory acts.

The British regulatory model after Brexit is not perfect, but it is predictable. If stability of regulations, jurisdictional reputation, access to UK banks, and the ability to issue cards are important to you, the E-money license provides all of this.

Moreover, if your product critically depends on the European market, it is worth considering a structure with two licenses or a partner network from the very beginning.

Need legal assistance? The experts at AA Lawrange are ready to provide consultations.

How to Obtain an EMI License in the UK

Before applying for registering an EMI license, it is worth determining one basic question: to establish a company from scratch or to purchase an already licensed one? We will try to answer this question further.

By the way, if you are targeting the EU market, we recommend additionally considering obtaining an EMI license in Ireland. This will provide access to all EEA countries through the passporting mechanism. The British license cannot offer this advantage, but it still remains a strong option for launching in the UK or a global fintech with an English-speaking audience.

Setting Up a Company for EMI Activities in the UK

Establishing a new company for obtaining an EMI license in UK provides the applicant with full control over the corporate structure, policies, and operational processes. This allows adapting all internal documents in accordance with current FCA requirements without the need to amend already existing systems.

The absence of operational history minimizes risks associated with past violations or non-compliance. The applicant independently forms the composition of directors and shareholders, which simplifies passing the “fit and proper” criteria check.

Below are the stages of company registration for EMI licensing.

Step 1. Selecting and Reserving the Company Name

The company name must be unique and not similar to those already registered in the Companies House register. If the name is too similar to an existing one, registration will most likely be rejected. The availability can be checked online, and reservation is free.

Step 2. Filing Incorporation Documents with Companies House

Most often, for EMI purposes, the Private Limited Company (LTD) format is chosen because it is flexible, easy to manage, and complies with FCA requirements. Minimum requirements include:

• at least one director (aged 16 or older);
• at least one shareholder;
• a registered address in the United Kingdom;
• issuance of at least one share.

Registration can be done online and usually takes up to 24 hours if the documents are properly prepared.

Step 3. Preparing Governance and Compliance Structure

This is a key stage that determines whether you will receive the license. First, it is necessary to appoint key persons:

• directors;
• compliance officer;
• MLRO (Money Laundering Reporting Officer).

It is also necessary to develop AML/KYC, internal control, risk management, and client fund safeguarding policies, as well as to describe the company structure, use of agents or branches, and reporting mechanisms.

Step 4. Submitting the EMI License Application to the FCA

The application is submitted via the FCA Connect online portal. You must send:

• a business plan with a 3-year financial forecast;
• a description of the services you plan to provide;
• proof of capital (for AEMI – minimum €350,000);
• compliance documents;
• information about shareholders, directors, and auditors.

After receiving the application, the FCA conducts financial, legal, and operational checks, and sometimes interviews the management to ensure the competence of the team.

The review period is 4 months for SEMI and 6 months for AEMI, provided no problems arise and no additional documents or confirmations are requested.

Purchasing a Ready-Made Company with EMI Authorization

An alternative to creating a new structure is to purchase ready companies with an EMI license. This significantly shortens time-to-market, but thorough verification at every stage is indispensable.

Do you want a company that already holds a valid FCA license for issuing electronic money? Then follow five steps.

Step 1. Confirm Financial Capability and Pass Fit and Proper Checks

First, as a buyer, you must prove your financial ability to maintain EMI activities in accordance with regulatory requirements. All new directors, shareholders, and key persons undergo FCA verification for compliance with the “fit and proper” criteria.

Step 2. Review the Compliance Framework

An assessment is carried out to verify whether the company’s compliance system meets current requirements (AML/KYC, data protection, internal control, reporting). The audit is performed by external legal advisers or specialized compliance firms with experience in licensed structures.

Step 3. Conduct Full Due Diligence

The company’s financial history, reputation, presence of regulatory remarks, or hidden risks are examined through legal and financial audits. Independent auditors, lawyers, and, if necessary, regulatory consultants are engaged.

Step 4. Prepare a Transition Plan

A clear integration plan is developed, describing how the company will be adapted to the new management structure, business model, and operational processes. The plan is prepared either by the buyer’s internal team or by external consultants, depending on the complexity of the transaction.

Step 5. Transfer Ownership and Control

Ownership transfer is completed after:

• signing the Share Purchase Agreement (SPA);
• registering changes with Companies House;
• updating access to bank accounts, domains, and systems;
• notifying the FCA of the change of control;
• completing the transition period, if applicable.

Only after that does the new owner gain full legal and operational control over the company.

Key Considerations Before Applying for EMI License in the UK

The FCA will assess the company as a fully operational structure capable of functioning within the regulatory framework. Therefore, consider several aspects in advance:

• The business model must be viable. For example, if you plan to issue cards, demonstrate how exactly this will be implemented technically and legally.
• Key persons must meet FCA requirements. It is preferable if the MLRO, director, and compliance officer have relevant experience and no conflict of interest.
• IT systems must be ready for launch. This includes an open safeguarding account, a functioning risk management system, etc.
• Compliance documents must be consistent. If the AML policy contradicts KYC procedures or incident management lacks step-by-step instructions, the regulator will request revisions.
• The financial structure must be transparent. Capital should be confirmed, sources of funds documented, and the ownership structure clear.

If even one of the criteria is not met, the procedure of registering an EMI license in UK will be delayed or result in refusal.

Eligibility Criteria for EMI Applicants

The FCA does not issue licenses “for the future.” Your company must be ready to operate as a licensed electronic money issuer — with a team, systems, capital, and logic.

Here are the basic criteria an applicant must meet:

1. The company must be registered in the United Kingdom, with physical or virtual presence, including a correspondence address.
2. The applicant must control the ownership structure. All shareholders and beneficiaries must be identified, with no offshore layers.
3. Capital must not be only formally declared but actually deposited in the account.
4. The team must be formed. In addition to the director, the staff should include an MLRO, financial manager, Head of Operations, IT Security Officer, Safeguarding Officer, and optionally a Customer Support Lead.

Overall, if your operational model is not implemented and exists only on paper, the FCA will not consider you a ready issuer. The regulator expects that everything is already functional or can be launched immediately.

Capital and Financial Requirements

Obtaining a license for electronic money in UK is much easier and faster if the company meets the financial criteria. This concerns both the initial capital and ongoing own funds obligations.

Initial Capital Requirement

For SEMI, whose average outstanding electronic money volume does not exceed €1 million, the minimum capital is €50,000. If this indicator ranges between €1 and €2 million, the requirement increases to €100,000.

For AEMI, a fixed threshold is set — not less than €350,000, regardless of the volume of operations.

Ongoing Own Funds Obligation

After obtaining the license, the company must maintain a sufficient level of own funds. For SEMI, this means at least 2% of the average amount of outstanding electronic money.

AEMIs, in turn, must calculate their own funds using special formulas defined by the FCA, taking into account risks, transaction volume, and type of services.

Application Fees and Related Costs

When applying for an E-money license in UK, the company pays a registration fee: £5,000 (~€5,750) for SEMI and £15,000 (~€17,200) for AEMI. These amounts are non-refundable, even if the license is not granted, so financial preparation must be flawless.

If the company engages external consultants, costs will increase significantly. Especially if needed:

• in-depth expertise and legal support;
• compliance system audit;
• adaptation of internal AML/KYC policies;
• development of a business model from scratch with financial forecasts.

The total expenses will depend on the complexity of the structure, the number of involved specialists, and the level of documentation detail.

Mandatory Documentation for EMI License Application

It is not enough just to register a company and deposit capital to obtain an EMI license in UK. The FCA will expect a full package of documents submitted together with the application:

• Business plan outlining services, target markets, revenue model, and financial forecasts;
• Programme of operations detailing service delivery channels and partnerships;
• Corporate documents (certificate of incorporation, memorandum, articles of association);
• Organisational structure;
• Capital evidence;
• Compliance policies (AML/CTF, KYC, data protection, risk management procedures);
• Financial statements (projected P&L, balance sheet, cash flow);
• Fit and proper documentation (CVs, certificates, reputation checks for directors and shareholders);
• Business continuity and disaster recovery plans;
• Security and complaints handling policies;
• Proof of application fee payment;
• IT systems overview including data access and security controls;
• Outsourcing details (if any).

Of course, this list is not exhaustive, but it gives an idea of the level of detail the FCA expects. Contact the lawyers at AA Lawrange — we will help you collect and structure the documents properly.

Why You Should Choose Lawrange

The world of electronic money, internet payments, and digital services seems familiar, as we use them daily and have been doing so for several years. Yet at the regulatory level, these topics remain blurred, with constantly updated requirements.

Yes, legislation has a habit of changing faster than businesses can adapt. However, the AA Lawrange team keeps up. And not only for this reason do clients turn to us:

• We have a deep understanding of EMI license requirements UK.
• We strategically build the management structure.
• We adapt documentation to regulator expectations.
• We provide support at every stage.

Are you launching a new EMI company or purchasing a ready-made one? Contact our manager to arrange your first free consultation!

Conclusions

With an EMI license, a global financial business market opens for you. Yes, the requirements are many, documents are complex, and the regulator pays attention to every detail. But if everything is done correctly, you will be able to launch new products, enter other markets, connect payment partners, and handle large volumes of transactions without regulatory barriers.

Making no mistakes is easier with experts in the field. Delegate the work to the AA Lawrange team!

FAQ

Obtaining an EMI License in the UK