Eternity Law International — News — License for electronic money in Estonia

License for electronic money in Estonia

Published:
October 6, 2020

Introduction

Located in Northern Europe, Estonia has become a center for digital innovation and financial evolution. At the heart of this transformation is the Electronic Money Institution (EMI) license, which unlocks a vast array of financial services and possibilities. In this in-depth investigation, we will explore the requirements, advantages, processes, sales, payments, costs, taxation, and the involvement of fintech in acquiring an EMI license in Estonia.

Requirements for an EMI License in Estonia

To embark on this transformative path, prospective financial institutions need to fulfill specific requirements.

Establishing a Legal Entity: The initial step involves setting up a registered company in Estonia, often in the form of a private limited company.

Meeting Share Capital Requirements: Ensuring an adequate capital base, with a minimum requirement of €350,000 on bank account, lays the financial foundation.

Qualified Management: The institution must have a capable management team well-versed in financial laws and practices.

Ensuring Adequate Infrastructure: A robust electronic infrastructure is crucial to ensure secure issues and compliant e-money transactions and payments.

Meeting Solvency and Prudential Requirements: Compliance with solvency and prudential standards as prescribed by Estonian financial law is mandatory.

Advantages of EMI Licenses in Estonia

Acquiring an EMI license in Estonia comes with numerous advantages.

EU Passporting: Once licensed in Estonia, financial institutions can seamlessly expand their services throughout the European Union, crossing borders effortlessly.

Advanced Digital Infrastructure: Estonia’s sophisticated digital infrastructure simplifies compliance, ensuring efficient customer service.

Low Bureaucracy: Estonia’s business-friendly environment minimizes administrative hurdles, expediting the licensing process.

Innovation Hub: Estonia’s pro-innovation stance creates a fertile ground for fintech startups, nurturing creativity and financial innovation.

Political Stability: As an EU member state, Estonia offers political stability, providing a secure environment for financial transactions, sales and capital investment.

Procedure for Obtaining an EMI License in Estonia

Securing an EMI license in Estonia involves a series of essential stages. Here’s a breakdown of the procedure:

  • Establish Your Registered Company: The initial and foundational step is the registration of a legal entity in Estonia. This step establishes the groundwork for your robust financial institution.
  • Prepare Required Documentation: Diligently compile all necessary documentation, which includes creating a comprehensive business plan.
  • Submit Your License Application: Forward your EMI license application to the Estonian Financial Supervision Authority, triggering the commencement of the regulatory evaluation process.
  • Onsite Inspection (if necessary): In cases that are more intricate or require further scrutiny, authorities may conduct onsite visits. These visits aim to ensure your readiness for electronic money operations and the management of bank accounts.
  • License Issuance: Upon receiving approval, you will be granted the highly sought-after EMI license. This license bestows upon you the authority to facilitate electronic money transactions and sales.

What is Included in Price of Our Services

When considering acquiring an Electronic Money Institution (EMI) license in Estonia, it’s essential to understand what is included in the services provided. Wt compile a comprehensive overview of the requirements, advantages, processes, and prices associated with obtaining an EMI license.

  • Regulatory Compliance: Our services guide you through the intricate process of ensuring your institution complies with Estonian financial laws and regulations. We help you navigate the legal landscape to meet solvency, prudential standards, and all other statutory requirements.
  • Document Preparation: We assist you in meticulously preparing the necessary documentation required for the EMI license application.
  • Application Submission: Our services extend to helping you submit your EMI license application to the Estonian Financial Supervision Authority. We ensure that your submission is complete and in compliance with all regulatory requirements.
  • Assessment and Evaluation: We guide you through the assessment process where regulatory authorities scrutinize your application. Our expertise helps you present your financial health and management expertise in the best possible light.
  • Onsite Support: In complex cases or when authorities require an onsite visit to assess readiness for electronic money operations, we provide support to ensure a smooth evaluation process.
  • License Issuance: Finally, upon approval, our services continue as we facilitate the issuance of the coveted EMI license. This license grants you the authority to facilitate electronic money transactions in Estonia and beyond.

Taxation of EMI Companies in Estonia

Estonia’s Tax Regime:

Estonia’s tax framework serves as a guiding light, illuminating the way for fintech enterprises in search of a favorable environment to thrive and pioneer innovations. One of the most captivating facets of this tax structure is the absence of a corporate income tax on retained earnings, a pivotal factor contributing to Estonia’s appeal to Electronic Money Institution (EMI) companies.

Zero Corporate Income Tax on Retained Earnings

The absence of a corporate income tax on retained earnings is a compelling incentive for fintech companies to establish themselves in Estonia. Retained earnings, often crucial for a company’s expansion and reinvestment, remain untaxed within the Estonian jurisdiction. Consequently, as fintech firms amass profits, they can channel them back into their operations without the burden of corporate income tax, granting them significant financial flexibility.

A Cohesive Tax Environment for Fintech

Estonia’s tax system is not solely about low rates; it is about fostering a cohesive environment that promotes the flourishing of fintech companies. It eradicates the complexities and uncertainties typically associated with tax planning and compliance. Fintech entities can concentrate on their core operations, secure in the knowledge that their tax obligations are clear-cut and transparent.

Furthermore, Estonia’s dedication to digital innovation extends to its tax administration. The nation’s robust digital infrastructure facilitates efficient tax reporting and compliance, diminishing administrative burdens and ensuring a seamless tax process for businesses.

How Much Does an EMI License in Estonia Cost?

The cost of acquiring an E-Money license in Estonia varies, influenced by factors such as application complexity, legal fees, and consultancy services. To ascertain an accurate estimate, it is prudent to consult specialized service providers. Despite initial expenses, the long-term benefits and access to the EU market render it a sound financial investment.

Conclusion

Estonia’s embrace of digital finance and its facilitative EMI license process have placed it firmly on the global fintech map. As an aspiring financial institution, navigating the waters of electronic money services in Estonia can be a transformative experience. The advantages of EU passporting, digital infrastructure, and a stable environment beckon fintech innovators to explore this exciting landscape, with the promise of a thriving future in the world of financial technology.

You could be interested

Gaming License in Romania

Romania, nestled in the heart of Eastern Europe, is not only a land of rich history and stunning landscapes but also a burgeoning hub in the global gaming industry. The National Gambling Office (Oficiul Național pentru Jocuri de Noroc – ONJN) serves as the regulatory authority overseeing the gaming sector. In this comprehensive guide, we...

Directive № 5 in Malta

In 2018, 2 important events took place for the world of virtual currency and digital wallets. One of them is Directive № 5 in Malta. The Government of the island of Malta adopted 3 legal acts regulating the sandbox of the blockchain. And in June, the EU Herald published the Fifth Money Laundering Directive, which...

How Europe’s AML regulation affects crypto

With expectations for an updated legal and regulatory mechanism toward virtual funds, experts state the EU might place a more hard-line attitude on cryptos. As specified in the recent media reports, 6 EU member states, namely, Austria, Germany, Italy, Spain, Luxembourg, and the Netherlands are on their way of implementing an AML law that will...

Bank account for casino

The specialists of our company have developed a full range of services for the registration of gambling companies in offshore zones and EU countries in those jurisdictions in which the gambling business is allowed. Our turnkey casino opening package includes the cost of opening a bank account for casinos, which can be done immediately after...

Bank account for forex company

How to open a bank account for forex company is an urgent issue for many. Today, a huge number of countries are adopting legislation that is aimed at combating money laundering transactions. Such measures have a great impact on the complexity of the procedures for opening accounts in foreign financial institutions. For this reason, it...

Investment in cryptocurrency in 2018

It seems incredible that humanity already has money that is not controlled by anything. Not subject to control and no one really and do not belong. Now we are talking about cryptocurrency. These are currencies not from the distant future, but from the present one, since investing in cryptocurrency today is considered to be almost...

Discover our services

The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.

Ready-made companies for sale

Companies with a bank account around the world

Banks for sale

Established Banks for sale

Ready-made licenses for sale

Forex, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Licensing

Forex licenses, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Offshore company registration

Expert advice on the acquisition of an offshore company

Open a bank account

Open bank accounts in more than 120 banks around the world
Fill the blank:

Zurich

Dreikonigstrasse, 31A, Stockerhof
+41 435 50 73 23

Kyiv

Baseina street, 7
+38 094 712 03 54

London

Grosvenor Gardens, 52
+44 203 868 34 37

Washington

1629 K St. Suite 300 N.W.
+1 (888) 647 05 40 Toll Free

Vilnius

Gediminas Avenue, 44A
+370 52 11 14 32

Tallinn

Kesklinna linnaosa, Tuukri 19
+372 880 41 85

Edinburgh

Lochrin Square, 1
+44 203 868 34 37

Nicosia

Jacovides Tower, 5 floor
+371 665 550 51

Riga

Esplanade, 7 floor
+371 665 550 51

Hong Kong

18 Harbour Road, 35/F, Central Plaza, Wanchai
800938622 Toll Free

Singapore

Level 42, Suntec Tower Three, 8 Temasek Boulevard
+6531594300

Sydney

20 Martin Place
+61 2 888 00 365

Porto

2609 Avenida da Boavista
+351 800 500 206 Toll Free

Tbilisi

Revaz Tabukashvili Str., N 45, area N 7
+995706070360