The Key Difference Between Payment Institutions & Electronic Money Institutions in Serbia
Understanding Payment Institutions in Serbia
Over the past decade, Serbia has established a comprehensive regulatory framework for payment services and electronic money issuance, led by the National Bank of Serbia (NBS). This legal structure has paved the way for the formation and operation of Payment Institutions (PI) and Electronic Money Institutions (EMI), which play a crucial role in Serbia’s financial ecosystem.
Despite these advancements, one common question remains: What is the key difference between Payment Institutions and Electronic Money Institutions?
Who Can Provide Payment Services in Serbia?
In Serbia, payment services can be provided by:
- Banks
- Payment Institutions (PI)
- Electronic Money Institutions (EMI)
- The National Bank of Serbia (NBS)
- The Treasury Administration or other authorized public authorities
- The Public Postal Operator
Payment Institutions vs. Electronic Money Institutions: The Main Difference
The fundamental distinction between Payment Institutions (PI) and Electronic Money Institutions (EMI) is that only EMIs are authorized to issue electronic money (e-money). This includes digital currency stored on prepaid cards, e-wallets, or other electronic devices.
On the other hand, an EMI can also offer all services provided by licensed Payment Institutions, making them more versatile in financial operations.
Licensing Requirements for Payment Institutions and Electronic Money Institutions in Serbia
To operate as an EMI in Serbia, businesses must obtain a license from the National Bank of Serbia (NBS). The application process involves submitting detailed documentation, including:
- A business plan outlining e-money operations
- A description of payment services to be provided
- Measures to safeguard the financial system
The licensing process for both PI and EMI typically takes between 3 to 6 months from the company’s registration date.
Services Offered by Payment Institutions in Serbia
Once licensed, Payment Institutions in Serbia can provide the following services:
- Depositing cash into a payment account, including account opening, maintenance, and closing (€125,000 capital requirement)
- Withdrawing cash from a payment account (€125,000 capital requirement)
- Executing payment transactions funded by a credit line, including:
- Credit transfers
- Direct debits (including one-off direct debits)
- Payment card transactions (€125,000 capital requirement)
- Issuing and acquiring payment instruments (€125,000 capital requirement)
- Money remittance services, allowing funds to be transferred without opening a payment account (€20,000 capital requirement)
- Processing payments via telecommunication, digital, or IT devices (€50,000 capital requirement)
Key Considerations Before Applying for a PI or EMI License
Before applying for a PI or EMI license, businesses must consider various regulatory requirements, such as:
- Corporate form and registered office in Serbia
- Nature of payment services (e.g., online checkout solutions)
- Adequate fund safeguarding measures to protect payment service users
- Plans for obtaining a safeguarding account with a Serbian bank
Regulatory Compliance and Supervision
The National Bank of Serbia (NBS) plays a crucial role in supervising all payment service providers and electronic money issuers. Both PI and EMI entities must strictly comply with regulatory requirements to avoid legal issues and potential penalties.
Conclusion
Serbia’s legal framework effectively regulates both Payment Institutions and Electronic Money Institutions, ensuring financial security and technological advancement in payment services. If you’re planning to offer payment solutions or e-money services in Serbia, obtaining the right license from the NBS is essential.
For more information on payment institutions, electronic money institutions, or other legal, tax, or business matters, feel free to contact us at [email protected] or call us at +381113281914 (Monday–Friday, 08:30–16:30).