The FinTech industry is fast-paced and highly regulated, meaning licensing agreements are essential to keep your business compliant and secure. Whether you’re handling digital payments, providing loans, or operating within the crypto space, having the right licenses ensures your business operates fairly and compliantly.
Here’s what you need to know about the difference licences you might need for your business:
1. Electronic Money Institution (EMI) Licence
If your business handles e-money, such as digital wallets or mobile payment systems, an EMI licence from the Financial Conduct Authority (FCA) is required. It allows you to issue and manage e-money and is really important for any FinTech working outside traditional banking.
2. Payment Services Directive 2 (PSD2) Licence
FinTech businesses offering payment processing services or secure transaction gateways need a PSD2 licence. This ensures you comply with data security standards and user authentication, which are essential in payment systems.
3. Consumer Credit Licence
If your FinTech offers loans or credit products, you’ll need a Consumer Credit Licence. This allows you to offer traditional or peer-to-peer lending and ensures your business follows UK regulations for consumer borrowing.
4. Financial Advice Licence
Providing investment advice or wealth management through your platform? A Financial Advice Licence is mandatory to ensure your advice meets UK legal standards.
5. Crypto-Asset Registration
For those operating in the cryptocurrency sector, the FCA mandates registration for anti-money laundering purposes. While it’s not a traditional licence, this registration is key for crypto exchanges, wallets, and blockchain businesses.
6. Open Banking Licence
FinTechs that use Open Banking technology to access and manage consumer financial data must register as an Account Information Service Provider (AISP) or Payment Initiation Service Provider (PISP). This registration allows you to manage customer data securely while developing innovative financial apps.
7. Intellectual Property Licensing
If your business uses third-party software, you’ll need IP licensing agreements to protect your tech stack and ensure you’re not infringing on anyone’s IP rights.
8. Data Protection and GDPR Compliance
While not a licence, GDPR compliance is essential for any FinTech handling customer data. There’s no excuse not to adhere to data protection laws in order to maintain trust with your customers, avoid hefty fines and manage your business partnerships.
Why licensing matters for FinTechs
Securing the right licences does more than keep you compliant—it boosts customer trust and supports growth into new markets. Being properly licensed signals to your clients that your business meets industry standards and is committed to safeguarding their money and data.
Navigating your licensing needs
At Jamieson Law, we specialise in helping FinTech businesses secure the necessary licences to operate legally and grow successfully. Get in touch with our team today to see how we can help.
