News

Guidelines for banks on opening accounts for e-money and payment institutions

May 29, 2020

The latest position of the Bank of Lithuania deals with a topical issue – difficulties for e-money and payment institutions to open accounts in banks. The problem that the Bank of Lithuania seeks to tackle is not unique to Lithuania; nonetheless, an active stance from local supervisory authorities is not common amongst EU member states.

The main takeaways from the position:

  • there are several types of accounts required for operations of EMIs/PIs: (i) current accounts, (ii)  safeguarding accounts, and (iii) accounts for the execution of payments; each type of account has a different inherent ML/TF risk;
  • the refusal by a bank to open accounts or decision to close accounts to EMIs/PIs must be based on analysis of each specific case and must follow the principles of objectivity, non-discrimination, and proportionality;
  • special attention of banks is required when closing the safeguarding accounts of EMIs/PIs; the banks must consider, whether the relevant financial institution will be able to continue ensuring the security of its clients’ funds.

You can read the full text of the position here: https://bit.ly/3dht3cI

It is unclear whether the position will strongly affect the banks that continue their “journey of de-risking”; nonetheless, it shows that the Bank of Lithuania pays attention to obstacles faced by the fintechs and seeks to make the operations of these types of companies easier.

Registered users may read additional comments of Donatas Šliora, Partner at ADON legal in a publication by moneylaundering.com here: https://www.moneylaundering.com/news/lithuanian-regulators-move-to-protect-banking-channels-for-fintechs/?