We assess the planned e-money and payment services and coordinate the EMI application, ownership information, governance and operating procedures.
A fintech client had gathered licensing information for an electronic money business but was unsure how to bring the application together. ARG coordinated the corporate records, responsible people, policies and supporting evidence so that they were consistent with one another. The client could see the outstanding work and understand the purpose of each next step.
That practical issue is common in EMI projects. The central question is not whether a product is marketed as a wallet or fintech platform, but whether it issues electronic money and therefore requires Bulgarian National Bank authorisation before launch. The guidance below explains the regulatory perimeter, capital requirements, application evidence, decision process and duties after approval.
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Your model must involve issuing monetary value received in exchange for funds and accepted by others. Map the issuer, customer claim and redemption rights.
Establish an eligible company with real management and operating substance in Bulgaria, transparent ownership and suitable managers.
Provide at least EUR 350,000 eligible initial capital, maintain the required own funds and arrange protection of money received from holders.
Prepare the programme, three-year forecasts, controls, technology arrangements and customer contracts, with Bulgarian-language supporting evidence.
An electronic money institution, usually called an EMI, is a company authorised to issue electronic money. In Bulgaria the licensing authority is the Bulgarian National Bank (BNB), and Articles 34–37 of the Law on Payment Services and Payment Systems require the permission before issuance starts. Registering a Bulgarian company, developing an app or signing with a card processor does not itself authorise the company to issue customer balances.
A payment institution licence and an EMI licence are not interchangeable. A payment institution may provide payment services, but an electronic money institution is licensed to issue electronic money as its core regulated activity. The law applies the same basic licensing logic to EMI applications by cross reference, including the provisions on authorisation, refusal, withdrawal, transformation and termination. In practical terms, the BNB does not treat this as a light upgrade. It checks whether the applicant is fit for a regulated money product, whether the governance is credible, and whether the business model matches the permissions sought.
That distinction matters commercially. If the planned product is a prepaid balance, wallet or stored-value product in which the client receives electronic money rather than only a payment service, the business normally needs EMI status. If the product only moves payment orders without issuing electronic money, the required licence may be different. The key question is not the marketing label. It is the legal function of the product.
For example, if your Bulgarian company receives EUR 100 and creates a EUR 100 balance that the customer can spend with unrelated merchants, analyse issuance, merchant settlement and redemption together. If a licensed partner issues that balance and your company only provides the interface, contracts and screens must identify the partner’s role accurately. An agent may distribute and redeem electronic money for the issuer; it cannot become the issuer merely by using the partner’s systems.
This is the point at which ARG helps a client decide whether the project belongs inside EMI licensing at all. That means testing the intended flow of funds, the customer balance model, the way value is issued and redeemed, and whether the business should be structured as an EMI from the start or whether the planned activity falls short of that perimeter. A business can waste time if it prepares a payment institution file for a product that actually requires e-money authorisation. It can also overcomplicate matters if the real model does not justify EMI licensing.
Start with the customer’s legal claim: who owes the balance to the user, who receives the funding and which independent merchants or recipients accept it? Those answers establish whether the product involves electronic money and who must hold the authorisation. A product name such as “wallet” cannot settle the licensing question.
A client should be thinking about this service if it is planning a wallet, stored-value product, prepaid scheme, fintech platform or similar business that needs a Bulgarian regulated base for issuing e-money. The Bulgarian framework also makes Bulgaria the controlling jurisdiction for this licence decision, so the national registered office requirement and the BNB authorisation process are central, not incidental.
The Bulgarian EMI licence covers the regulated issuance, distribution and redemption of electronic money, and it can also accommodate certain payment services if the applicant notifies the BNB and meets the additional legal conditions. In other words, the licence is not only about putting money into a wallet. It is about the full regulated life cycle of electronic money and the related operational steps that make the product work.
The application programme of activities must describe how the business will issue electronic money, how funds will move in and out, how settlement will work, what draft contracts will be used, how internal control will function, and how AML and CFT controls, security incident handling, sensitive data handling, business continuity and statistical reporting principles will be organised. That is why the licence is a perimeter decision as much as a corporate one. The BNB is not only asking what the company sells. It is asking how the regulated activity will actually operate.
Article 34(1) defines electronic money through several linked features: a monetary value stored electronically, a claim against its issuer, issuance after receipt of funds, a payment purpose, and acceptance by someone other than that issuer. A reloadable wallet accepted by independent merchants can meet that definition. A record of money owed for the company’s own goods may have a different status. Limited-network products require a separate assessment under Articles 2 and 34(5), including notification obligations where applicable.
Redemption is part of the product design. Under Article 35, holders have a right to redeem at nominal value, subject to the statutory rules on timing, contractual terms and permitted charges. The terms must explain how a user requests withdrawal, which evidence identifies the holder, how remaining balances are reconciled and how a closed account is settled. An EMI cannot pay interest or another benefit linked to how long the electronic money is held. These rules distinguish a payment balance from a bank savings product.
The law also allows some payment services to sit alongside EMI activity, but only where the applicant notifies the BNB together with the EMI application and satisfies the relevant conditions. That point matters because many fintech businesses do not stop at pure e-money issuance. They want to combine wallet issuance with payment services such as transfers or related operational services. The legal question then becomes whether those services are within the notified perimeter and whether the company has described them clearly enough for the BNB review.
A practical distinction helps here.
If an applicant already holds a payment institution licence, that licence is cancelled when the EMI licence is granted. That is a real structural consequence, not a paper formality. It means the client should not assume that the EMI licence simply sits on top of the old authorisation without effect. The legal status of the business changes with the authorisation that is finally granted.
For a client deciding whether the service is needed, the practical issue is whether the intended business model is really an e-money model with connected payment functions, or whether it is better characterised as payment services without issuance. ARG’s role at this stage is to align the product, the legal perimeter and the regulatory notifications before the file is built, so the business does not submit a model that the BNB will read differently from the applicant's own description.
Tell us where you live, how your business works and what you want to change. We will help you identify the questions to resolve and the next steps to consider.
The Bulgarian EMI licence cannot be treated as a low-capital fintech registration. At licensing, the applicant must have at least EUR 350,000 in initial capital, and that capital must exist when the licence is granted. The governing law is the Bulgarian Law on Payment Services and Payment Systems [ЗПУПС], which sets the licensing basis for electronic money institutions and explains how the BNB tests whether the business is financially and legally ready to operate. The statutory capital floor is separate from the wider suitability review, but both matter because the BNB looks at whether the applicant is funded in a way that matches the proposed regulated activity.
For a client, the practical point is that the money must be real and properly traceable, not only promised in a business plan. The law requires the initial capital to be made up of eligible capital items under Regulation (EU) No 575/2013, and BNB Ordinance No. 16 allows the capital to be built from the items listed in Article 8(1), items 1 to 5, which cover common equity and reserve-style components. That means the structure of the funding matters as much as the amount. If the capital is assembled from shareholder funding, retained earnings or other eligible items, the file must show that the relevant amounts are legally available and properly reflected in the company records.
The initial capital floor is not the same thing as the ongoing prudential test. An EMI must at all times hold own funds at least equal to the higher of the statutory own-funds requirement or the EUR 350,000 floor. In other words, once the licence is granted, the business cannot simply remain compliant because it once raised the starting capital. It must keep its own funds above the relevant threshold throughout the life of the licence.
That difference becomes important when the business starts trading. A company may be comfortably above the initial capital floor on day one, but later fall below the ongoing own-funds requirement because of losses, expansion costs or an undercapitalised operating model. The legal risk is not abstract. A balance sheet that is sufficient for filing can become insufficient after launch if the operating model is too aggressive.
If the EMI also carries on ancillary activities under Article 42, the non-electronic-money payment activity is measured under the separate own-funds formula in Article 9(1) and (2). That means a mixed model needs two layers of thinking. First, the company must satisfy the fixed capital floor for EMI authorisation. Second, it must continuously test whether the broader activity mix pushes it into a higher own-funds requirement. A wallet business that also performs additional payment functions should therefore not rely on a single funding number prepared for the application file.
For issuance itself, Article 39 sets the own-funds requirement at 2% of average outstanding electronic money. That average is calculated from daily financial liabilities over the preceding six calendar months, on the first day of each month, and applies for that month. Payment services unrelated to issuance are calculated separately, and the applicable requirements are combined before comparison with the EUR 350,000 floor. A fast-growing wallet therefore needs monthly calculations, realistic forecasts and a funded plan for increasing own funds; customer safeguarding balances are not the company’s capital.
A useful commercial way to read this is to ask three questions before filing. Is the planned capital legally eligible. Is it already paid and evidenced. Will it still be enough after the business begins issuing electronic money and carrying any ancillary services. If the answer to the third question is uncertain, the capital plan should be redesigned before the application is filed rather than after the BNB has already started its review.
The BNB does not grant an EMI licence on a general business description. It expects a structured filing package under BNB Ordinance No. 16 that proves who the applicant is, where it is based, how it is funded, who controls it, and how the regulated activity will actually run. The file must include incorporation documents, proof that the required capital has been paid, declarations on the origin of the funds used for the shares or stakes, a unique identification code, regulatory-status information, a programme of activities, and a business plan with a forecast budget for the first three financial years.
That list is important because it shows the BNB is checking both corporate form and operational substance. The programme of activities must go beyond a marketing description. It has to explain issuing, distributing and redeeming electronic money, the movement of funds, settlement, draft contracts, internal control, AML and CFT controls, security incidents, sensitive-data handling, business continuity, and the principles for statistical data. In practice, this is where many applications become weak. If the policies, the financial model and the corporate documents do not tell the same story, the file looks assembled rather than designed.
The persons managing and representing the applicant, members of the management and supervisory bodies, and also certain qualifying shareholders and controllers must satisfy qualification, professional experience and good-repute requirements. The ordinance gives the BNB room to request extra information or verification if there is doubt. For non-Bulgarian nationals, the BNB may require a criminal-record certificate issued within three months before filing. The practical effect is that governance evidence is not limited to CVs. It must support a clean and credible control structure.
The filing language also matters. Supporting documents must be filed in Bulgarian. Foreign-language documents must be submitted in original with a Bulgarian translation, and formal documents must be legalised according to the applicable law. This is not a drafting preference. It is an acceptance issue. A technically good application can still be delayed if the translations, legalisation or document format do not meet the ordinance requirements.
For a client, the preparation question is whether the application is already internally consistent. The corporate records, shareholder evidence, management details, capital proof, source-of-funds declarations and business plan should all match. If they do not, the BNB will see separate fragments rather than one regulated business case. ARG’s role in that stage is to align the file so the legal entity, the controllers, the policies and the financial projections support the same licence request.
Make the safeguarding method operational before launch. The account structure, accounting ledger and reconciliation process must distinguish customer funds from the EMI’s operating money and identify discrepancies promptly. Record who investigates an unmatched balance, who can authorise a transfer and how the business continues if its banking or technology provider becomes unavailable. DORA also requires the institution to govern ICT risks and its third-party dependencies. Outsourcing a platform does not transfer the EMI’s responsibility for secure and resilient delivery.
Under Articles 11 and 37, the BNB examines the application and decides within three months of receipt. If it identifies missing documents or information, it can require them within a period of up to two months; the decision then follows within three months of receiving the additional material. Plan the launch around readiness of the corporate, financial and operational evidence. Preparing documents, answering a regulator’s request and completing technical arrangements are separate from the statutory decision period.
The BNB application-review fee is EUR 5,000 under Article 70(2) of Ordinance No. 16, effective from 1 January 2026. It is separate from the EUR 350,000 minimum initial capital and from the project’s legal, translation, audit, staffing, technology and safeguarding arrangements. Build a budget that identifies each item and when it must be funded. Paying the fee does not reserve a licence or remove the substantive review of the application.
EMI licensing does not end with the decision letter. Safeguarding is mandatory. Funds received in exchange for electronic money must be safeguarded under the measures in Article 23. If the money arrives by payment instrument, safeguarding may be delayed only until the funds are credited or otherwise made available, but in any event no later than five business days after issuance of the electronic money. Significant changes in the safeguarding measures must be notified to the BNB in advance. That means the company must build its treasury and operational controls around safeguarding from the start, not retrofit them later.
There is also a structural consequence if the applicant already holds a payment institution licence. Once the EMI licence is granted, the payment institution licence is cancelled. If the business wants to continue providing payment services as an additional activity, it must notify the BNB together with the EMI application. So the client should not think in terms of keeping an old licence as a fallback. The EMI authorisation resets the regulatory base, and the application should be planned on that assumption.
For a client deciding what to do next, the immediate question is whether the file is ready for submission or still needs legal and operational alignment. If the corporate records, the governance pack, the capital evidence and the safeguarding model are already coherent, the application can move into filing. If they are not, the better course is to fix the gaps before the BNB sees the package. That is usually the difference between a controlled licensing process and a cycle of incomplete submissions and avoidable delay.
Compare the related procedures in this category, including their requirements and the stage at which you need them.
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