How to Apply for Authorization as a Payment Institution with the Bank of Spain

In this article, we will explain the process and remind you that attolón can assist you in obtaining the authorization or registering your institution. We have the best lawyers in the industry and can tailor a team to guide you through the entire process.

Who Should Apply for Payment Institution Authorization?

Payment institutions providing professional services in Spain are required to apply for authorization from the Bank of Spain. These institutions are regulated by RD 19/2018, dated November 23, and offer services such as:

  1. Cash deposit into a payment account and its management.
  2. Cash withdrawal from a payment account.
  3. Execution of payment transactions through payment accounts, including fund transfers, direct debits, card payments, etc.
  4. Execution of payment transactions when funds are covered by a credit line, including the aforementioned operations.
  5. Issuance of payment instruments or acquisition of payment transactions.
  6. Money remittance.
  7. Payment initiation services.
  8. Account information services.

The Bank of Spain is responsible for authorizing the establishment of these payment institutions. To do so, they will gather a report from the Executive Service of the Anti-Money Laundering and Monetary Offenses Prevention Commission.

Exceptions and Specifics RD 19/2018 allows other providers, such as credit institutions, to offer payment services. It also allows certain entities to undergo only the registration procedure.

These include aggregators that solely provide account information services and entities whose average total value of payment transactions executed in the preceding 12 months does not exceed three million euros.

In these cases, it is not necessary to go through the authorization process. However, the registration procedure, including verification of requirements, is still required in the corresponding central registry.

There are also specific operations that can be subject to registration only. For example, the provision of services based on limited payment instruments, cash withdrawals from ATMs, or purchases of digital content.

Given the current regime of exemptions and specifics, it is highly recommended to consult with a specialized lawyer in payment services for each specific case. This ensures that the institution understands the applicable system and has the best legal coverage.

Authorization for Opening Branches and Provision of Services by Community Institutions

It is important to note that the authorization regime for opening branches and free provision of services, when it concerns payment institutions recognized in other EU member states, is relatively lenient. In such cases, a communication from the supervisory authority of the home member state is required.

The opening of branches only requires registration in the Commercial Registry and the Special Registry of the Bank of Spain. However, to initiate the free provision of services, the Bank of Spain must receive the aforementioned communication.

How to Submit the Authorization Application

As mentioned earlier, the first step in applying for authorization as a payment institution with the Bank of Spain is to analyze the applicable regime for the institution. In general terms, we can differentiate between general payment institutions and those with low business volume. However, it is advisable to consult with a specialized lawyer beforehand.

Registration of Payment Institutions with Low Business Volume

This category includes individuals and legal entities that wish to provide payment services other than payment initiation and account information services. Additionally, their transaction volume must not exceed three million euros per month, and they must not operate abroad.

Given these limitations, payment institutions can opt for a simplified registration procedure. They need to complete the forms provided by the Bank of Spain and submit the corresponding documentation.

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