Information for payment institutions and e-money institutions
Pursuant to section 8 (1) of the Payment Services Oversight Act (Zahlungsdiensteaufsichtsgesetz, ZAG), an institution wishing to provide payment services as a payment institution in Germany, commercially or on a scale which requires a commercially organised business undertaking, needs written authorisation from the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, or BaFin).
The same applies to e-money institutions pursuant to section 8a of the Payment Services Oversight Act (Zahlungsdiensteaufsichtsgesetz – ZAG). E-money business is the issuance of e-money, which is defined as any electronically stored unit of monetary value in the form of a claim on the issuer, issued against payment of a cash amount, in order to carry out payment transactions and also accepted by parties other than the issuer. The provision of payment services is included in the licence to conduct e-money business.
Since the ZAG came into force, these institutions have been legally defined as two categories of payment service providers.
Pursuant to section 1 (2) of the ZAG, payment services comprise:
- deposit and withdrawal transactions
- Payment transactions in the form of direct debits, credit transfers and card payments excluding the granting of credit
- payment transactions involving the granting of credit
- payment authentication transactions
- digital payment transactions
- money transmission services
In addition, the ZAG defines exceptional cases in which payment services are not rendered.
As part of the licencing procedure, both groups of institutions are required to submit, inter alia, a business model, a business plan with a budget plan for the first three financial years and a description of the measures required to fulfil the security requirements of section 13 of the ZAG. Payment institutions and e-money institutions are subject to different requirements, for instance for initial capital.
The Notice on the granting of authorisation to provide payment services pursuant to section 8 (1) of the Payment Services Oversight Act (Merkblatt über die Erteilung einer Erlaubnis zum Erbringen von Zahlungsdiensten gemäß § 8 Abs. 1 ZAG) (available only in German) contains details on how to obtain authorisation.
An overview of the notification and reporting requirements for institutions in accordance with the Payment Services Oversight Act (Zahlungsdiensteaufsichtsgesetz) (available only in German) can be downloaded.
Examples of calculating capital requirements according to the different methods specified in the Payment Institutions' Capital Regulation (Zahlungsinstituts-Eigenkapitalverordnung) can be found under Overview of the calculation methods specified in the Payment Institutions' Capital Regulation (Zahlungsinstituts-Eigenkapitalverordnung).