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FINANCIAL LICENSE (EMI) IN ESTONIA

EMI is a legal status under which a company has the right to issue electronic money, carry out payment transactions, etc., according to the Estonian Payment Institutions and E-money Institutions Act. The license is issued by the Estonian Financial Supervision Authority (Finantsinspektsioon / Financial Supervision Authority, FSA).

ADVANTAGES

  • Access to the EU market through passporting

  • Estonia has a well-developed digital infrastructure, and the perception of fintech is positive.

  • Transparent regulation, relatively clear rules

  • The absence of old restrictions on the amount of electronic money stored on devices (after being abolished in 2018) is important for business models with mobile wallets or payment cards

  • Full passporting in EU countries

  • Easy company formation (via e-residency)

  • A loyal and technologically flexible regulator

  • Transparent tax system (0% on retained profit)

  • High level of digitalization — most procedures online

MAIN REQUIREMENTS

  • Minimum capital: €350,000 (Full EMI)

  • Legal form: Estonian company (Osaühing – OÜ or AS)

  • Office in Estonia: real office and staff (not virtual)

  • Directors: minimum 2 directors with experience in finance/risk management

  • Власники / UBO: Перевірка джерел капіталу та репутації

  • Ключові посадові особи: Compliance Officer (MLRO), Risk Manager, Internal Auditor

  • IT-система Безпечна, надійна платформа для обліку електронних грошей

  • AML/CFT система: повна відповідність естонському AML-законодавству

The procedure for obtaining an EMI (Electronic Money Institution) license in 🇪🇪 Estonia, one of the most popular and technologically advanced fintech jurisdictions in the EU.

Regulator: Finantsinspektsioon (FI) — Estonian Financial Supervisory Authority.

Main acts are:

  • Payment Institutions and E-Money Institutions Act
  • Money Laundering and Terrorist Financing Prevention Act (AML Act)
  • Directive 2009/110/EC (EMD2)

EMI License Types

  • Small EMI (Limited EMI): for local operations with a small volume of transactions; Passporting - no
  • Full EMI Licence: full license to issue e-money and provide payment services across the EU; Passporting - yes

Necessary documents for Finantsinspektsioon

Business documentation

  •  Business plan (for 3 years with financial forecasts)
  • Description of business model, client segments, services
  • Cash-flow scheme of operations
  • Agreement with the bank that will store client funds

Corporate Documentation

  • Company Registration Documents (Articles of Association)
  • Directors and UBO Details
  • Management CVs
  • Confirmation of Capital (Bank Letter)

Policies and procedures

  • AML / CFT Policy
  • Risk Management Policy
  • IT & Data Security Policy
  • Safeguarding Policy (захист коштів клієнтів)
  • Compliance & Internal Audit Policy
  • Complaints Handling Policy

EMI License Procedure

  • Company Registration in Estonia Through e-Business Register or with the participation of a local representative.
  • Appoint directors, MLRO, compliance officer.

Preparation of a package of documents: all policies, business plan, corporate documents, description of IT systems ️

Pre-Application Meeting: a meeting or call with Finantsinspektsioon is recommended to clarify the requirements.

Application Submission: a formal application with all documents is submitted; official fee: approximately €4,000–5,000.

Completeness Check: FI checks whether the package of documents is complete (up to 30 days), assessment of the application (Assessment Stage).

Reputation and experience of managers, AML / IT policies, financial stability, technical infrastructure, may request additional information or interview are checked.

Issuance of a license

  • After approval, the company enters the public register of the Finantsinspektsioon.
  • It receives a full EMI license (with the right to passporting across the EU).

Estimated time

  • Document preparation - 1–2 months
  • FI review - 1 month
  • Evaluation and approval - 3–6 months
  • Total - 4–8 months

Post-license obligations

  • Annual audit AML/CFT reporting to FI
  • Maintenance of minimum capital
  • Storage of client funds in separate accounts
  • Internal control and regular policy updates

 

WHAT IS  PASSPORTING

Passporting is a key concept in European Union (EU) financial regulation that opens up great opportunities for companies licensed in one EU country.

Passporting is the right of a financial institution licensed in one European Union or EEA country (e.g. Malta, Estonia, Lithuania, Poland) to provide its services in other EU countries without the need to obtain a new license in each of them.

Passporting is like a "European financial passport": get a license in one EU country and you can legally work in all 27 countries without new permits.

Advantages of passporting

  • No need to obtain a license in each EU country
  • Reduction of costs and time to enter new markets
  • Single compliance center and regulator
  • Transparency and customer trust across the ES

Types of passporting

  • Freedom to provide services (FPS): activity in other EU countries without a branch (via the internet or remotely)
  • Freedom of establishment (FoE): opening a representative office or branch in another EU country

How it works: ️

  • The company obtains, for example, an EMI license in Lithuania (issued by the Bank of Lithuania).
  • Then it submits a notification to the regulator (MFSA, KNF, FI, etc.) about its intention to provide services in other EU countries.
  • The regulator sends a notification to the relevant supervisory authorities of other countries.
  • After 1–2 months, the company can legally operate in these countries - open accounts, issue electronic money, make payments, advertise services, etc.

Example:

  • If an EMI company has a license in Estonia, it can, through passporting: Offer e-wallets to customers in Germany, France, Spain, etc.;
  • Operate under the same brand in all EU countries;
  • Not open a new company or obtain a local license.

What services can be “passported” :

  • Issuance of electronic money (e-money)
  • Provision of payment services (transfers, wallets, cards)
  • Currency exchange, FX services
  • Maintenance of payment accounts
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Owner and CEO LOCMAN ICS LTD

Ludmila Chilik

Corporate and tax lawyer (Europe, USA, East Asia, UAE)

2025-11-04T13:40:34+03:00