Head of International Corporate Law and Fintech Practice
Expert in fintech, crypto, and international corporate law with over 20 years of experience. Specializes in crypto licensing (VASP/CASP), iGaming business support, and international structuring, asset protection, and OSINT analytics for risk assessment and due diligence.
Obtaining a PSP Licence for a Payment Service
Launching your own payment service in Europe often begins with a simple question: which licence is actually required to operate?
The term PSP (Payment Service Provider) is commonly used in the business environment, but it is important to understand that PSP primarily describes a provider of payment services rather than a universal type of licence. Depending on the business model, a company may operate, for example, as a Payment Institution (PI), Electronic Money Institution (EMI), or under another regulated status.
Therefore, the first step should not be searching for a “PSP licence”, but determining which specific payment services the company intends to provide.
What is a PSP and who needs this status?
A Payment Service Provider is a company that provides payment services to clients. This category may include banks, payment institutions, electronic money institutions and other entities whose status is determined by the applicable legislation.
For a FinTech company, a PSP model may be relevant if the business plans to create its own payment service through which clients can make or receive payments.
For example, these may include:
- payment platforms for businesses;
- international money transfer services;
- solutions for e-commerce;
- merchant payment services;
- payment gateways;
- embedded finance products;
- B2B payment solutions.
However, the fact that a company calls itself a PSP does not itself determine its legal status. What matters is what the company actually does.
Is a separate PSP licence required?
There is no universal “PSP licence” for all EU countries. Most often, this term refers to a licence or authorisation that allows a company to provide the relevant payment services.
Different models may involve:
| Model | Typical regulatory status | Main application |
|---|---|---|
| Payments and transfers | Payment Institution | Payment services and transfers |
| Electronic money + payments | EMI | Wallet, e-money and payments |
| Full banking functionality | Bank | Deposits, lending and banking services |
| Technology service for a licensed provider | Depends on the model | Software/API/infrastructure |
This is why a regulatory analysis should be carried out before launching a PSP project.
What services can a payment service cover?
Depending on the specific model, a company may work with different types of payment transactions.
At the structuring stage, it is necessary to determine:
- whether the company will transfer funds;
- whether it will work with merchant acquiring;
- whether it plans to provide a wallet or e-money product;
- whether it will use its own or a partner’s payment infrastructure.
The answers to these questions directly affect the type of regulatory status required.
When can a PSP service be launched through a partner?
Not every FinTech project needs to obtain its own licence immediately.
At an early stage, a company may build its product on top of the infrastructure of an already licensed PI or EMI. This allows the business model to be tested without the cost of creating its own regulated institution.
This approach may be appropriate for startups that:
- are still testing product-market fit;
- have relatively low transaction volumes;
- want to enter the market faster;
- are not ready to maintain a full compliance function.
However, it is important to define the company’s role correctly. If it effectively begins providing regulated payment services independently, using another entity’s licence merely as formal cover may create significant regulatory risks.
What requirements apply to a PSP project?
If the company obtains its own regulated status, the regulator assesses more than just the quality of the product.
Areas of focus may include:
- corporate structure;
- ultimate beneficial owners;
- professional reputation of owners and management;
- business plan;
- financial model;
- AML/KYC;
- risk management;
- IT and cybersecurity;
- safeguarding of client funds;
- internal controls.
Particular importance is placed on consistency between the stated business model and the actual operating structure.
For example, if a company claims that it will serve tens of thousands of clients but does not have sufficient personnel, IT infrastructure and risk control procedures, the regulator will naturally raise questions.
What documents are required to obtain PSP status?
The specific package depends on the selected regulatory regime and jurisdiction. However, a complex payment project will generally require a comprehensive set of documents.
These may include:
- corporate documents;
- ownership structure and information on UBOs;
- business plan;
- financial projections;
- description of payment flows;
- AML/KYC policies;
- risk management framework;
- IT and cybersecurity documentation;
- business continuity plan;
- management documentation;
- evidence of the source of capital.
It is important not merely to collect documents, but to build a single coherent model that the regulator can assess.
How much does it cost to launch a PSP service?
The cost depends on whether the company operates through a licensed partner or seeks its own regulatory status.
In the latter case, it is necessary to consider not only legal support but also:
- regulatory fees;
- required capital;
- compliance and AML;
- key personnel;
- IT infrastructure;
- cybersecurity;
- audit;
- accounting and operational support.
Therefore, the budget should be calculated for the entire project lifecycle, not only until the licence is obtained.
How to obtain authorisation for a PSP service?
The process can be divided into several stages.
- Business model analysis.
We determine which functions the company performs and which of them may be regulated. - Selection of the regulatory model.
We compare PI, EMI, the partnership model and other possible options. - Jurisdiction selection.
We analyse the requirements of the relevant regulator, capital, governance, compliance and scaling prospects. - Preparation of documentation.
We prepare the business plan, AML/KYC, risk management, IT documentation and corporate package. - Submission and communication with the regulator.
We support the application, respond to requests and revise the documents. - Launch and ongoing compliance.
After obtaining the status, ongoing compliance with licensing and regulatory requirements must be ensured.
Own licence or PSP through a partner?
This is one of the key strategic decisions for a FinTech company.
Having its own regulatory status provides greater control and independence but requires significant resources. A partnership model enables a faster product launch, but the company depends on the provider’s terms, risk appetite and compliance policy.
Therefore, before making a decision, it is worth comparing:
- projected transaction volume;
- the cost of obtaining and maintaining an own licence;
- partner fees;
- the required level of control;
- scaling plans;
- investor requirements;
- the complexity of future products.
For a startup, a partnership model may be optimal. For a large-scale FinTech project with significant transaction volume, its own PI or EMI may make considerably more economic sense.
What advantages does an own regulatory status provide?
- Control over payment infrastructure. The company is less dependent on a third-party provider.
- Scalability. Regulated status may become a foundation for the development of new products.
- Greater control over the customer experience. The business can independently develop payment flows and its operating model.
- Regulatory certainty. A clearly defined status reduces the risk of building the business on an incorrect legal structure.
- Investment value. For a potential investor, regulatory status may be an important part of assessing a FinTech company.
Do you need your own PSP licence?
Before launching a payment service, it is worth answering four questions:
- Who legally receives and transfers client funds?
- Who controls the payment infrastructure?
- Which specific payment services does the end user receive?
- Does the company plan to scale its own payment product in the EU?
If the company independently performs regulated functions, the appropriate status — most commonly PI or EMI — should be determined before operations are launched.
Why choose Prikhodko & Partners?
Prikhodko & Partners supports international FinTech projects from business model analysis and determination of the regulatory perimeter to company structuring, preparation of licensing documentation and communication with the regulator.
We help determine whether the business needs its own PI/EMI licence or whether it would be more appropriate at the initial stage to use the infrastructure of a licensed partner.
We also provide separate support on AML/KYC, banking and payment infrastructure, compliance and the further scaling of the FinTech project.
Planning to launch your own payment service in the EU? Contact Prikhodko & Partners for business model analysis, selection between PI, EMI and a partnership model, document preparation and comprehensive legal support for the project.
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Is there a separate PSP licence in the EU?
The term PSP describes a payment service provider rather than a single type of licence. Depending on the model, a company may obtain the status of a Payment Institution, EMI or another appropriate regulatory status.
Can a PSP be launched without its own licence?
In some models, yes. A company may use the infrastructure of a licensed PI or EMI. However, the functions of each party must be properly defined, and it is necessary to ensure that the activities do not go beyond the permitted model.
Can a PSP licence be used for a cryptocurrency business?
It depends on the specific model. If the payment service also involves providing crypto-asset services, the applicable requirements for crypto-asset services must be analysed separately to determine whether an additional regulatory status is required.
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