Payment System License in Cyprus
Cyprus traditionally offers unique opportunities for conducting business, as payment systems (PS) can easily interact with local offshore companies and their bank accounts. However, to legally perform all related operations, a company must be licensed.
License for a Payment Institution in Cyprus: Benefits of Licensing
By obtaining a PS license, legal entities receive the following benefits:
- They can engage in activities related to financial operations, including currency conversion, storage and processing of relevant information, and more.
- After registration, PS can rely on confidentiality and secure operations with favorable taxation.
- No capital gains tax and relatively low corporate income tax.
Among additional advantages, the license allows companies to work with debit and credit products via plastic cards, accept payments through various devices such as POS terminals, as well as carry out transactions through mobile and cellular operators.
Payment System Licenses in Cyprus: What Applicants Need to Consider
All PS opened in Cyprus are regulated by the Securities Commission, which closely monitors that legal entities comply with all legal requirements. To obtain a license, the PS must be registered in Cyprus. The management must have an impeccable reputation and professional skills of a certain level, necessary to fulfill their official duties.
A payment system license in Cyprus is granted only if certain requirements are met. The company must:
- Prepare a description of all planned payment services.
- Prepare a financial and business plan for three years.
- Provide proof of share capital of at least EUR 350,000.
- Have a legal advisor, external and internal auditor, risk manager, and accountant.
- Register with the register of the Central Bank of Cyprus.
- Prepare and submit documents related to the company’s internal procedures, as well as an application with personal details of shareholders and directors (passport copies, residential addresses, etc.).
A payment institution license in Cyprus is a permit that allows a company to provide services across the European Union. However, it imposes certain obligations, which may require:
- A description of KYC tools and other means aimed at protecting clients’ personal data.
- Proof of compliance with AML (Anti-Money Laundering), as well as a description of measures to implement this policy.
- A description of risk protection measures, internal control procedures of the PS, etc.
Specifics of Obtaining a Payment Institution License in Cyprus
To obtain a license, it is not enough to simply submit documents and wait for approval. It is necessary to personally visit the Cyprus Securities Commission for an interview with the regulator’s staff: this is a legislative requirement.
After this, the licensing application review process begins. It usually takes around 4 months, but in some cases the duration can be longer.
If you need a payment system license in Cyprus, contact our company. We will handle all mandatory procedures, prepare the necessary documents, and provide you with legal advice. This minimizes the risk of licensing refusal and saves you time and effort.
Free initial consultation on legal issues related to the daily activities of the business
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learn moreFrequently Asked Questions:
To obtain a payment system license in Cyprus, you must prepare a business plan, AML policy, and other documents, register a company, and hire specialists for mandatory positions (director, AML officer, etc.). Essential elements for obtaining a license include a bank account and paid-up share capital.
When choosing a payment system, it is necessary to consider its license, service coverage regions, and acceptable payment methods. You must also ensure that the payment system’s requirements match your company’s characteristics (country of incorporation, residency of its participants, etc.). The tariffs offered by the payment system also play an important role.
If all company maintenance requirements are met, the license is perpetual. However, the license may be revoked if the company remains inactive for a long time and/or violates operating rules.
The final cost of obtaining a payment system license in Cyprus depends on various factors (exact list of future services, region of operation, etc.). To find out the exact cost for your company, please contact our specialists.
