1. SPI (Small Payment Institution) – UK

Regulator: Financial Conduct Authority (FCA)

Description: An SPI is a type of license under the UK’s Payment Services Regulations 2017. It's meant for smaller firms offering limited payment services.

Key Points:

• Maximum monthly payment transactions: €3 million (average over 12 months).
• Can offer services like money remittance, payment initiation, and account information.
• Lower capital requirements than Authorised Payment Institutions (APIs).
• Fewer compliance obligations, but cannot passport services across the EU post-Brexit.

 

2. API (Authorised Payment Institution) – UK

Regulator: Financial Conduct Authority (FCA)

Description: This is for larger firms looking to offer payment services on a broader scale than SPIs.

Key Points:

• No transaction volume cap, unlike SPIs.
• Must meet higher capital and safeguarding requirements.
• Can offer services such as:
• Money remittance
• Direct debits
• Credit transfers
• Payment initiation and account information services
• Post-Brexit, APIs must comply with local licensing in each EU member state to operate there.

 

3. SEMI (Small Electronic Money Institution) Licence – UK

Regulator: Financial Conduct Authority (FCA)

Description: Allows issuing electronic money on a limited basis.

Key Points:

• Total outstanding e-money cannot exceed €5 million.
• Must comply with AML regulations but faces lighter regulatory oversight.
• Cannot passport into other countries (like a full EMI could pre-Brexit).
• Typically used by early-stage fintech start-ups.

 

4. Money Transfer License – Europe

Regulator: Varies by country, typically central banks or national financial authorities.

Options:

• Payment Institution (PI) or E-Money Institution (EMI) license under the EU’s PSD2 directive.
• Can passport services be used across the EEA (European Economic Area) if based in the EU.

Key Points:

• Subject to Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements.
• Capital requirements vary based on the services provided.
• Post-Brexit UK-based entities cannot passport into EU—they need a local EU license.

 

5. Money Transfer License – USA

Regulator: State-by-state licensing + Federal oversight

Description:

• Each U.S. state has its own Money Transmitter License (MTL) requirements.
• Federal oversight from FinCEN (Financial Crimes Enforcement Network) for AML compliance.

Key Points:

• Need a license in every state where you operate (some states offer exemptions or reciprocity).
• Costly and time-consuming: must meet bonding, net worth, compliance, and reporting standards per state.
• Must register as an MSB (Money Services Business) with FinCEN.

 

6. Money Transfer License – Australia

Regulator: AUSTRAC (Australian Transaction Reports and Analysis Centre)

Description:

• Money transfer businesses must register as Remittance Service Providers.

Key Points:

• Must comply with AML/CTF (Counter-Terrorism Financing) rules.
• No separate “license” like in the U.S.—registration and ongoing compliance are required.
• Businesses may also need an AFSL (Australian Financial Services Licence) depending on the services.

 

7. Cryptocurrency Licence – UK

Regulator: Financial Conduct Authority (FCA)

Description:

• Firms that deal in crypto must register with the FCA under the Money Laundering Regulations (MLRs).

Key Points:

• Covers crypto exchanges, custodian wallet providers, etc.
• Must meet AML/KYC and fit and proper standards.
• Not a license to operate as a financial institution (no passporting, no FSCS protection).
• FCA has been strict, rejecting many crypto firm applications.