Payment institution

Payment services, licensing procedures and review times, licence extension procedure, licence exemption procedure

If you wish to provide payment services within the meaning of Article L. 314-1 of the Monetary and Financial Code in the normal course of your business, you must submit an application for a payment institution licence to the Autorité de contrôle prudentiel et de résolution (ACPR).

Payment services

Payment services essentially comprise:

 

  • Services enabling cash to be deposited into or withdrawn from a payment account and the transactions required to manage such an account;

 

  • Execution of payment transactions associated with a payment account (card payments, credit transfers and direct debits);

 

  • Transmission of funds;

 

  • Issuance of means of payment and/or acquisition of payment orders.

 

In addition to payment services, payment institutions may provide related services as defined in the applicable regulations.

Before licensing a payment institution, the ACPR checks the following:

 

  • suitability of the legal form for the proposed activity,

 

  • sufficient initial capital and level of prudential capital with respect to capital requirements,

 

  • programme of operations and technical and financial resources,

 

  • identity and status of direct and indirect capital contributors, and where applicable, of their guarantors,

 

  • central administration located in the same national territory as the registered office,

 

  • sound governance arrangements including a clear organisational structure with a well-defined, transparent and consistent division of responsibilities,

 

  • persons effectively running the undertaking or the persons placed in charge of the payment services activity in the case of hybrid institutions (institutions pursuing other commercial activities) must meet propriety, knowledge, experience and fitness requirements,

 

  • effective risk detection, management and control procedures and an appropriate internal control system, including sound administrative and accounting procedures and appropriate arrangements to prevent money laundering and terrorist financing,

 

  • protection of user funds,

 

  • resources implemented to ensure the security of means of payment and general organisation to ensure security, oversight of orderly operation and fraud prevention.

 

If it is expected that the payment volumes handled by your institution will not exceed a monthly average of EUR 3 million and if you do not plan to provide the service of fund transmission, it is possible to apply to the ACPR for a limited payment institution licence (art. L522-11-1 of the Monetary and Financial Code).

 

In this case, the prudential requirements are adjusted, notably in terms of initial capital, capital requirements and internal control (restricted to control of key service providers). This category of institution is not eligible for a European passport.

Licensing procedures and review times

Before beginning financial activities, you must :

 

  • contact the Authorisation, Licensing and Regulation Division to present your plans and proposed timetable;

 

  • prepare an application for the desired licence, including all supporting documentation:
    • Payment institution
    • Payment institution with a limited licence (the model application form is in the process of being prepared; see the Authorisation, Licensing and Regulation Division for required documentation)

 

The complete application must be submitted in two paper copies and one electronic copy on a USB key to the ACPR General Secretariat.

 

After receiving your application, the Authorisation, Licensing and Regulation Division will review your request. The ACPR will issue the payment institution licence within three months of receipt of a complete application.

 

As part of the review of the application and in accordance with the regulations, the licence is issued after obtaining the opinion of Banque de France on the security of the means of payment. If the application is incomplete, additional information may be requested and the review period extended.

Licence extension procedure

When does an application need to be made for authorisation?

 

Your institution is planning to provide new payment services that are not currently covered by its licence.

 

Please:

  • contact the Secretariat of the Authorisation, Licensing and Regulation Division to organise a meeting to present your plans and proposed timetable;

 

  • mail in a detailed request for prior authorisation for an extension of activity accompanied by a licensing application (cf. above), making sure to complete all the relevant sections. In the letter, please specify in particular:
    • the strategy followed,
    • the timetable for completing the project,
    • the expected impact of the change in the activity of your institution, by filling out the sections of the form corresponding to your request (notably the proposed programme of operations, forward-looking management information and the supervisory arrangements that you plan to set up).

 

The ACPR has two months to review an application to extend a licence, provided it is complete.

Licence exemption procedure

The College of the ACPR may, under very specific circumstances, grant a licence exemption (art. L. 521-3 of the Monetary and Financial Code):

An undertaking may provide payment services based on means of payment that are accepted for the acquisition of goods or services solely on the premises of the undertaking or, under a commercial agreement with it, within a limited acceptance network or for a limited range of goods or services.

To grant this exemption, the ACPR considers in particular the following points:

 

  • security conditions for the means of payment;

 

  • consumer protection arrangements.

     

To apply for a licence exemption, you must:

 

  • contact the Secretariat of the Authorisation, Licensing and Regulation Division to present your plans;

 

  • mail in a detailed application for prior authorisation based on the following form:

 

Exemption form

 

After receiving your application, the Authorisation, Licensing and Regulation Division will review your request. The ACPR will issue the payment institution licence exemption within three months of receipt of a complete application.

 

If the application is incomplete, additional information may be requested and the review period extended. As part of the review of the application and in accordance with the regulations, the exemption is issued after obtaining the opinion of Banque de France on the security of the means of payment.

 

Once the exemption is obtained, the undertaking must provide the ACPR with an annual report evidencing compliance with the abovementioned provisions and the security of the means of payment that it issues and manages. The ACPR will send a copy of this annual report to the Banque de France.

Updated on: 07/17/2017 16:41