Operate as a Financial Institution License in Lithuania

Bank Licence

Before submitting a banking licence application, the applicant must verify and pay the applicable state fee in accordance with the current Lithuanian government fee schedule. The proposed bank must demonstrate adequate governance, management suitability, staffing, operational resources and internal control functions appropriate to its activities, scale and risk profile. There is no universal statutory requirement for every Lithuanian bank to employ at least ten management staff members. Staffing arrangements are assessed individually by the competent supervisory authorities. Reach out to the Company in Lithuania UAB team today to receive a personalised consultation on exact requirements for your planned activities.

Key requirements for the bank:

• All submitted documents must comply with the requirements established by the legal acts regulating banking activities, all correct data specified in the legal acts or additionally required must be submitted.
• The bank’s capital must be at least 5 mln. EUR, and 1 mln. EUR for a specialised bank; the capital requirements may be higher depending on the activities of the bank.
• Founders, shareholders and/or voting rights holders must be of good reputation and financially reliable.
• The managers must be of impeccable reputation, have qualifications and experience that allow them to perform their duties properly (in addition, at least one head of the bank’s administration must speak Lithuanian and be a permanent resident of Lithuania).
• Founders, shareholders and/or voting rights holders must demonstrate their ability to execute their proposed business plan, including preparation to provide financial services safely and reliably at the time the licence is issued.

Electronic Money Institution Licence

Lithuania offers a restricted Electronic Money Institution (EMI) licence for eligible businesses intending to provide electronic money services within Lithuania. This authorisation has simplified requirements compared with a full EMI licence, including an exemption from the standard EUR 350,000 initial capital requirement, subject to applicable statutory conditions. However, a restricted EMI licence does not provide EU/EEA passporting rights. An institution wishing to expand regulated electronic money services across the EEA must obtain the appropriate full authorisation and complete the applicable cross-border notification procedures. The most notable differences compared to the regular licence are: 1) the minimum initial capital requirement doesn’t apply to a limited activity electronic money institution, 2) such an institution can only operate in the territory of Lithuania.

The average amount of outstanding electronic money (if the activity is not performed, the average planned amount) of a limited activity licensee must not exceed 900,000 EUR per month over the preceding six calendar months. If this limit is exceeded, the institution is obligated to apply for the issuance of a regular (unlimited activities) licence within 30 days of the date on which that fact became apparent.

Key requirements for the electronic money institutions:

• All submitted documents must comply with the requirements established by the legal acts regulating the activities of such institutions in Lithuania.
• The minimum initial capital must be at least 350,000 EUR (again, this requirement doesn’t apply to an applicant for a limited activities licence).
• Shareholders and/or voting rights holders must be able to ensure reliable and prudent management of the institution, have excellent reputation and demonstrate financial stability.
• The managers must be of impeccable reputation, have qualifications and experience that allow them to perform their duties properly.
• The founders (holders of shares or voting rights) must demonstrate the capabilities for the proposed business plan implementation, as well as be prepared to provide financial services in a safe and sound manner at the time of receiving a licence.

Crowdfunding Licence

Although it’s still referred to as an alternative source of raising capital, crowdfunding has been rapidly gaining popularity among progressive investors and innovative entrepreneurs as a means of financing business growth and the implementation of various projects.

All the elements of the crowdfunding licence application and requirements for the activities of crowdfunding service providers are laid out in the Crowdfunding Regulation, and elaborated in the report on technical standards under the Crowdfunding Regulation published by the European Securities and Markets Authority (ESMA). A crowdfunding service provider authorised by the Bank of Lithuania under Regulation (EU) 2020/1503 may provide qualifying crowdfunding services in other EU Member States through the cross-border notification procedure established by Article 18 of the Regulation. The provider must submit the prescribed information to the Bank of Lithuania, which communicates it to the relevant host authorities and ESMA. A separate crowdfunding authorisation in each host Member State is generally not required for services covered by the EU regulatory framework, although applicable regulatory conditions and the scope of authorisation must be respected.

There’s an extensive list of requirements that a crowdfunding service provider must meet when applying for the licence. It includes the following key elements:

• The applicant’s operational programme must specify the types of crowdfunding services it intends to provide and the crowdfunding platform it intends to manage, including where and how the crowdfunding offer will be marketed.
• The applicant must indicate how payment services are provided in the context of the provision of crowdfunding services.
• The applicant must have a description of the management arrangements and internal control mechanisms which ensure compliance with the crowdfunding regulation, including various aspects of risk management and accounting procedures.
• The applicant must establish a business continuity plan that, taking into account the nature, scale and complexity of the crowdfunding of the services provided by the applicant, sets out measures and procedures to ensure the continuity of critical services related to existing investments.
• The applicant must provide information on the persons responsible for the management of the institution and evidence that these persons are of good reputation as well as have appropriate knowledge and skills.
• The applicant must establish internal rules addressing conflicts of interest in accordance with Article 8 of Regulation (EU) 2020/1503. Crowdfunding service providers must not participate in crowdfunding offers on their own platforms. They must not accept their shareholders holding 20% or more of share capital or voting rights, their managers or employees, or natural or legal persons linked to them by control as project owners on their platforms. The provider must also establish appropriate arrangements for identifying, preventing, managing and disclosing conflicts of interest, including those arising from investments by relevant connected persons where permitted.

In addition to the above-mentioned licences, the Bank of Lithuania also grants financial licences for currency exchange operators, credit unions, payment institutions, consumer credit intermediaries and other financial services businesses.

If you’re seeking qualified assistance in applying for a financial services licence in Lithuania, our team here at Company in Lithuania UAB will be more than happy to step in. We’ll help you with the preparation of all the required documents, as well as guide you through all the procedures. Reach out to us today to book a personalised consultation.

We pride ourselves in providing quality service of legal advice in accordance with the latest local legislation, taxation advice as well as financial accounting services. Additionally, we offer virtual offices to those, who’re looking to build a professional image while optimising business costs.