Regulations for EMI license in Netherlands

The Dutch Central Bank (De Nederlandsche Bank, DNB) operates under the Financial Supervision Act (Wft) and serves as the primary regulatory and supervisory authority for Electronic Money Institutions (EMIs) in the Netherlands. The core objectives of the DNB include:

Obtaining an EMI license in the Netherlands involves complying with a detailed regulatory framework designed to ensure the stability and integrity of the financial system.

Key Regulations Include:
  • Capital Requirements: Applicants must have a minimum initial capital of EUR 350,000. This requirement ensures that the institution has adequate financial resources to operate effectively and manage potential losses.
  • Corporate Structure and Governance: The management team and board members must meet fit and proper criteria, demonstrating relevant experience and a clean regulatory history. The institution must also have a clear organizational structure with defined responsibilities.
  • Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) Compliance: EMIs must implement comprehensive AML and CTF measures, including customer due diligence, transaction monitoring, and reporting suspicious activities to relevant authorities.
  • Operational Requirements: Institutions must have appropriate IT systems, risk management procedures, and internal controls in place to ensure secure and efficient operations. This includes safeguarding customers’ funds and maintaining detailed transaction records.
  • Consumer Protection: EMIs must adhere to consumer protection laws, ensuring transparency in fees and terms, providing clear information to customers, and effectively handling complaints.
  • Reporting and Auditing: Regular reporting to the DNB is mandatory, including financial statements and compliance reports. Additionally, EMIs must undergo periodic audits to verify compliance with regulatory requirements.
  • Passporting Rights: Once licensed, an EMI in the Netherlands can utilize EU passporting rights to operate across the European Economic Area (EEA) without needing additional licenses, facilitating business expansion.
  • Application Process: The application process involves submitting comprehensive documentation, including business plans, risk management policies, and information on the ownership structure. The DNB rigorously reviews applications to ensure all regulatory criteria are met​.

By adhering to these regulations, EMIs in the Netherlands can benefit from a stable and supportive regulatory environment, promoting innovation and growth within the financial technology sector.

Types of EMI licensing in Netherlands

License typeDescription
EMI LicenseComprehensive financial services including issuance of electronic money, execution of payment transactions, management of electronic payment systems, and provision of operational risk management solutions
Small Electronic Money Institution (SEMI) LicenseOffers electronic money services and payment services on a smaller scale, suitable for businesses with lower operational volumes and capital requirements. Must not exceed €5 million in average outstanding e-money or €3 million per month in payment.
Payment Institution (PI) LicenseCovers a broad range of payment services including executing payment transactions, issuing and acquiring payment instruments, and money remittance. Suitable for businesses engaging in extensive payment.
Small Payment Institution (SPI) LicenseProvides a range of payment services on a smaller scale, with lower capital requirements. Ideal for smaller businesses looking to offer payment services without the need to issue electronic money. Limited to operating within the UK and must not exceed €3 million in average monthly payment.

With EMI license in Netherlands you can provide following services:

  • services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account
  • services enabling cash withdrawals from a payment account as well as all the operations required for operating a payment account
  • execution of payment transactions, including transfers of funds on a payment account with the payment service provider of the payment service user or with another payment service provider: execution of direct debits, including one-off direct debits, execution of payment transactions through a payment card or a similar device and/or execution of credit transfers, including standing orders
  • execution of payment transactions where the funds are covered by a credit line for a payment service user: execution of direct debits, including one-off direct debits, execution of payment transactions through a payment card or a similar device and/or execution of credit transfers, including standing orders
  • issuing and/or acquiring of payment instruments
  • money remittance
  • execution of payment transactions where the consent of the payer to execute a payment transaction is given by means of any telecommunications terminal equipment, digital or IT device and the payment is made to the telecommunications network or IT system operator, acting only as an intermediary between the supplier of the goods or services and the payment service user
  • Account information services
  • Issuance of e-money

Overview of requirements to obtain EMI license in Netherlands

To secure an Electronic Money Institution (EMI) license in the Netherlands, applicants must fulfill a set of regulatory requirements as stipulated by the Dutch Central Bank (DNB):

  • Establish a company under Dutch law with no restrictions on the nationality of shareholders.
  • Appoint 2 local directors who are residents of the Netherlands.
  • Ensure that board members possess a strong reputation and a thorough understanding of the financial sector.
  • Demonstrate adequate financial resources to cover the initial capital requirement of EUR 350,000, along with additional reserves as necessary.
  • Maintain a physical office in the Netherlands to conduct business operations.
  • Provide a comprehensive and realistic business plan detailing the proposed operations and strategies.

Estimated time frames

Company formation

1 week

Documents preparation

4-12 weeks

PI / EMI license obtainment from DNB

3-9 months

Note: The timeline may vary based on the DNB’s workload and any additional information or clarifications requested during the application process.

Legal services for obtaining EMI license in Netherlands

Basic Package

35,000 EUR initial set up

  • Turnkey company formation
  • Legal address for 1 year
  • Corporate documents
  • Due diligence for shareholders and key directors
  • Overview of the business plan
  • Overview of financial forecasts
  • Overview of an organizational structure
  • Analysis of the internal documents
  • Applying for the license

Registration of the EMI / PI licensed company under the minimum regulatory requirements

Additional services on request

  • Preparation of individual business plan
  • Preparation of required documents for the licensing
  • Accounting services
  • Assistance in opening bank account, including segregated and safeguard accounts
  • Connection with SEPA system
  • Connection with SWIFT
  • Connection with card issuance programme
  • Apostilled corporate documents
  • Introduction to confirmed software provider
  • Legal support

Ready-Made solution

available on request

  • Registered company
  • Legal address for 1 year
  • No debts, no liabilities – clean company
  • Active license
  • Corporate documents
  • Assistance with transfer of ownership

Edgar Mironov

Head of FinTech Projects

Requirements for EMI licensing in Netherlands

List of required documents

  1. Application Form: Completion and submission of the official licensing application form to the DNB.
    • Purpose: Serves as the formal request for the EMI license, containing basic information about the applicant.
  2. CVs and Qualifications:
Detailed CVs for shareholders, board members, and key team members.
    • Purpose: Demonstrates the qualifications, experience, knowledge, and skills necessary for independent duty performance. The DNB may conduct interviews to assess these qualifications further.
  3. Operational and Organizational Structure:
Comprehensive documentation of operational procedures and organizational structure, including detailed scrutiny checks for Management Board members, CEO, and Head of Branch Manager.
    • Purpose: Ensures a reliable operational framework and appropriate governance structure are in place.
  4. Business Plan:
A detailed plan outlining the services offered, budget forecasts for the first three financial years, marketing and promotion strategies, and key market segments.
    • Purpose: Provides a strategic vision and financial roadmap for the institution’s operations.
  5. Activity Program:
Documentation detailing the services provided and operational locations.
    • Purpose: Clarifies the scope and geographic reach of the EMI’s activities.
  6. Internal Policies and Manuals:
Includes policies for risk management, business continuity plans, and measures to protect electronic money holder funds.
    • Purpose: Ensures the institution has robust internal controls and procedures to manage risks and protect customers’ funds.
  7. AML/KYC and IT Security Policies:
Detailed procedures and third-party engagements for Anti-Money Laundering (AML) and Know Your Customer (KYC) processes, and IT security policies, including data centers and cloud storage solutions.
    • Purpose: Demonstrates compliance with AML/KYC regulations and ensures the security of IT systems and data.
  8. Compliance with Liability Insurance:
Proof of meeting liability insurance requirements.
    • Purpose: Provides financial protection against potential liabilities.
  9. IT Infrastructure and Architecture:
Information on IT solutions employed, agreements with third-party IT service providers, and details on IT infrastructure.
    • Purpose: Ensures the institution has the necessary technological capabilities and reliable IT infrastructure.
  10. Questionnaire on Operational Risks:
A detailed questionnaire to assess the risks associated with the operational aspects of the business.
    • Purpose: Helps the regulator evaluate how operational risks are managed and mitigated.
  11. Questionnaire on Information and Communication Technologies and Security Risk Management:
A questionnaire to evaluate the risks related to IT systems and data security.
    • Purpose: Assesses the institution’s preparedness in managing IT and security risks.
  12. External Audit Partnership and Quote:
Engagement with an accredited external auditor to ensure compliance and financial transparency, along with a quote for external auditing services.
    • Purpose: Ensures ongoing compliance with financial regulations and provides an independent assessment of the institution’s financial health.

Share Capital and Government Fees

  • Minimum Share Capital:
    • For obtaining a PI license in the Netherlands, the minimum share capital is EUR 20,000.
    • For obtaining a full EMI license in the Netherlands, the minimum share capital is EUR 350,000.
    • Additionally, an extra capital reserve to ensure a capital adequacy ratio of at least 1.3 – 1.5 is advised.
  • Government Fees: The application fees for a PI or EMI license in the Netherlands is EUR 6,800.

Bank account requirements

  • Safeguarding Account: Detailed arrangements for the establishment of a safeguarding account with an EU credit institution to manage funds separately from those of non-electronic money holders.
  • Operational Bank Accounts: Necessary for managing daily operational expenses and transactional purposes, facilitating the processing of customer transactions through current accounts.
  • Current Account: For transactional purposes, allowing for the receipt and sending of payments related to the services offered.

Personnel Requirements

  • Management Board: Minimum of two local directors, with the CEO possibly being a board member.
  • Local AML and Compliance Officers: Responsible for compliance with regulatory standards and AML regulations.
  • IT Security Officer: Can be outsourced; manages IT security measures to protect data and operational integrity.
  • Internal Audit Officer: Can be outsourced; ensures ongoing internal compliance and operational audits.
  • Local Data Protection Officer (DPO): Depending on the scale of the data processing activities and the nature of the data handled, EU GDPR may require the appointment of a Data Protection Officer (DPO) if the organization’s core activities consist of data processing operations that require regular and systematic monitoring of data subjects on a large scale.
  • Chief Financial Officer (CFO): Oversees financial planning, management, and reporting; ensures compliance with financial regulations and reporting requirements.
  • Chief Risk Officer (CRO): Manages risk assessment and mitigation strategies; ensures the implementation of robust risk management frameworks.

Not sure about the number of staff you need to employ for your PI/EMI project? Contact Legalaes experts to define the right personnel structure for your business model.

Business premises requirements

  • To obtain a EMI license in Netherlands it is necessary to establish a physical office in the Netherlands for document storage and providing a working space for staff, affirming the company’s operational base in the Netherlands.

Roadmap of the project

For more detailed road map of the project and commercial offer – get in touch with our FinTech professional.

Edgar Mironov

Head of FinTech Projects

1

Document Preparation / Company Formation

The process starts with reviewing and preparing company documentation. This includes the preparation of incorporation documents, engagement with a notary public, and registration within the Dutch Companies Register.

2

Preparation of Documents for EMI License Application

Legal consultation regarding the business model and advice on organizational structure and the management team are provided. This phase also involves the preparation and review of all documentation required for the EMI license application.

3

Investor's Clearance to National Security Interests

Preparing and submitting the necessary documentation for obtaining clearance related to national security interests from shareholders, UBOs, and the DNB. This stage also involves communication with state authorities, leading to the issuance of a decision.

4

Submission of the Document Set to the DNB

Submitting the complete document set to the DNB, accompanied by the payment of the stamp duty for license issuance. A case officer is assigned, and the application undergoes thorough assessment.

5

Rounds of Q&A with the DNB

Engaging in rounds of questions and answers with the DNB, which require the submission of amendments and additional documentation as necessary. This includes handling direct communications with the DNB.

6

Receipt of the EMI License

Preparing for the launch of business activities following the granting of the EMI license, including subsequent steps such as applications for SWIFT and card issuing solutions.

Detailed Time Frames to Obtain a EMI License in Netherlands

The estimated time frames to obtain an Electronic Money Institution (EMI) license in the Netherlands can vary depending on several factors, including the completeness and quality of the application, the complexity of the business model, and the responsiveness of the applicant to any additional information requests from the regulator, De Nederlandsche Bank (DNB). Here is a general outline of the process and the associated time frames:

1.  Preparation Phase

Time Frame: 4-12 weeks

2.  Submission of Application

Time Frame: Immediate to 1 Week

Assisting in submitting the complete application to the DNB.

3.  Regulatory Review Phase

Time Frame: up to 3 months

4.  Response to Queries

Time Frame: Varies

During the detailed assessment, DNB may request further information or clarifications. Assisting in responding to these queries promptly can impact the overall time frame.

5.  Decision Phase

Time Frame: 3-4 months

Total Estimated Time

Factors Influencing the Time Frame

By ensuring thorough preparation and proactive communication with the regulator, we help streamline the process and potentially reduce the time required to obtain an EMI license in the Netherlands.

Advantages of the EMI license in Netherlands

Obtaining an Electronic Money Institution (EMI) license in the Netherlands offers several strategic and operational advantages for fintech companies. Here are the key benefits:

Links for legislation related to EMI business in Netherlands

The Prevention of Money Laundering and Terrorist Financing Act (Wet ter voorkoming van witwassen en financieren van terrorisme, Wwft) establishes the legal framework for combating money laundering and terrorist financing in the Netherlands. This act outlines the responsibilities of financial institutions in identifying, preventing, and reporting activities suspected of being related to financial crimes.

The Financial Supervision Act (Wet op het financieel toezicht, Wft) provides the legal foundation for the supervision of financial markets and institutions in the Netherlands, ensuring compliance with European standards. This act covers the authorization and operation of financial institutions, including EMIs.

The Dutch Companies Act (Burgerlijk Wetboek Boek 2) governs the incorporation, regulation, and dissolution of companies in the Netherlands. This act facilitates ease of doing business and provides a framework for the establishment and operation of both local and international companies.

Regulation (EU) No 648/2012 on OTC derivatives, central counterparties, and trade repositories, known as EMIR, regulates the clearing, reporting, and risk management standards for derivatives in the EU.

Directive (EU) 2015/2366 on payment services in the internal market (PSD2) aims to make payments safer, increase consumer protection, foster innovation, and enhance the security of payment services across the EU.

Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments (MiFID II) revises trading processes and enhances transparency across the EU financial markets.

Regulation (EU) No 600/2014 (MiFIR) complements MiFID II by setting out requirements related to the disclosure of trade data to the public and transaction execution obligations in financial markets.

Netherlands EMI license regulatory body - Dutch Central Bank (DNB)

Taxation of EMI Companies in Netherlands

The taxation of Electronic Money Institution (EMI) companies in the Netherlands is governed by a set of tax regulations designed to create a favorable business environment while ensuring compliance with national and EU tax laws. Here are the key aspects of taxation for EMI companies in the Netherlands:

FAQ about EMI license in Netherlands

1. Why choose the Netherlands for setting up your EMI company?

The Netherlands offers a strategic central location in Europe, efficient regulatory processes, robust financial infrastructure, and a skilled, multilingual workforce, making it ideal for fintech companies.

2. Who can apply for an EMI License in the Netherlands?

Financial institutions with a solid reputation, substantial experience, and a commitment to compliance with regulatory standards can apply for an EMI license from the Dutch Central Bank (DNB).

3. How long does it take to get licensed by the Dutch Central Bank (DNB)?

The licensing process typically takes around 6 to 9 months, depending on the completeness of the application and responsiveness to DNB’s requests.

4. I have a license in another country; would it be useful?

Yes, a license from another country demonstrates adherence to high regulatory standards, potentially easing the application process in the Netherlands.

5. Should I establish an office in the Netherlands?

Yes, a physical office in the Netherlands is required to comply with DNB’s regulatory standards and provides a base for operations and documentation.

6. What are the main benefits of obtaining an EMI license in the Netherlands?

Benefits include access to SEPA for seamless euro payments, a stable economic environment, a comprehensive legal framework, and a supportive fintech ecosystem.

7. What are the key regulatory requirements for an EMI in the Netherlands?

Requirements include meeting minimum capital thresholds, robust AML/CTF measures, a clear corporate structure, a detailed business plan, financial stability, and compliance with tax and reporting regulations.

8. What kind of support can fintech companies expect from Dutch regulators?

Dutch regulators, like the DNB, offer resources such as the Innovation Hub to help fintech companies navigate regulatory challenges and bring innovative products to market efficiently.

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At Legalaes, we specialize in providing end-to-end assistance for setting up your EMI company in the Netherlands. Our experts are ready to guide you through each step of the licensing process, ensuring compliance and helping you establish a successful operation in one of Europe’s most favorable business environments.

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