AEMI licence is a permit issued by the UK Financial Conduct Authority to operate as an authorised electronic money institution. This status allows firms to issue electronic money, provide a wide range of payment services and conduct transactions comparable to basic banking functions, with exception of lending and accepting deposits.
In practice, AEMI is often viewed not only as regulatory status, but also as ready-made business for sale to investors wishing to quickly enter the fintech market. AEMI differs from small EMI in that there are no restrictions on the volume of electronic money issued and it is possible to provide an extended range of services.
EMI’s activities in the UK are regulated by PSR and EMR rules, as well as the FCA’s consumer protection requirements. It is important to note that following the UK’s withdrawal from the EU, AEMI authorisation doesn`t automatically grant the right to operate within the EU/EEA without additional authorisation or structural solutions.
FCA demands for applicants
Key requirement for applying for AEMI is to be a registered legal entity in the UK. The organisation must have a physical presence with a real office and operate under the region of FCA. To apply, you must have appropriate authorised capital, a management team with a proven track record, adequate risk management systems, internal controls, anti-money laundering procedures and an operational plan.
Minimum authorised capital is often considered to be in the range of £350,000, reflecting regulator’s requirements for applicant’s financial stability. Availability of funds allocated for consumer protection is mandatory and must be formalised through approved mechanisms. For example, segregated bank accounts or insurance structures.
FCA also requires that all key managers, including directors, compliance officers and those responsible for AML, be registered and meet “fit and proper” criteria. Regulator checks their experience, qualifications, professional reputation and ability to manage regulated firm.
Preparation of company and documentation
Preparation for submission begins with registering a company in the UK. This is standard procedure for registering legal entity through Companies House, specifying address and organisational structure. Next, detailed package of documents is compiled for FCA, including:
- business plan describing model, products, target markets and sources of income;
- financial forecasts and reports;
- risk management and internal control schemes;
- description of AML/CTF systems and measures to combat financial crime;
- evidence of consumer protection mechanisms;
- documents on key managers and shareholders.
FCA requires that applications be submitted via their Connect electronic system. An incomplete set of documents, missing forms, or failure to pay required fee will result in application being rejected.
Submission process and deadlines
Process begins with preparing and reviewing documentation. After submission via Connect, the regulator assigns an officer to the case and begins assessment. FCA may request additional materials or clarifications, which extends the assessment period. The practical timeframe for reviewing a complete AEMI application can take between 9 and 18 months, depending on the completeness of the package and the nature of the regulator’s comments.
Payment of the registration fee is mandatory and non-refundable. The amount of fee depends on licence category and complexity of case.
Until FCA makes an official decision on application, the company must maintain compliance with requirements, including availability of qualified personnel, systems and processes specified in application, as the regulator conducts thorough checks at all stages.
Passportisation and international aspects
Following the UK’s withdrawal from the EU, AEMI licence doesn`t confer a direct right to provide services within EU/EEA. Companies planning to operate in these markets should consider obtaining additional authorisations in EU regions or using structural solutions such as subsidiaries with EMI licence in EU and joint working arrangements.
In addition, once AEMI authorisation has been granted, firm must comply with FCA’s requirements for reporting, monitoring, disclosure, combating financial crime and maintaining adequate risk management on an ongoing basis throughout the licence period.
Practical recommendations
Organisations often seek professional support from consultants or law firms specialising in FCA licensing to prepare applications, liaise with regulators, develop documentation and ensure compliance prior to submission. Such support can reduce timeframes and increase chances of successful authorisation.
Another possible route is to purchase an existing licensed company with an active AEMI licence, which allows you to bypass the lengthy review period and gain immediate access to the market, but requires FCA approval of the change of control and confirmation of the new owner’s compliance.
Obtaining an AEMI licence in the UK is a complex, multi-stage process that requires thorough preparation of the company, financial resources, risk management systems and full compliance with FCA regulatory requirements.
Licence grants the right to provide a wide range of financial services in the electronic money sector, but imposes strict obligations regarding consumer protection and internal control. A successful outcome depends on the quality of the documentation package, the management team’s compliance with requirements, and the company’s ability to demonstrate a sustainable and secure business plan.
FAQ: AEMI licence in UK
What is the difference between AEMI and SEMI?
AEMI has no restrictions on the volume of electronic money issued and can provide a full range of payment services provided by EMR and PSR. SEMI is only suitable for small projects: it has limits on turnover and amount of customer funds, as well as a narrower list of operations.
What is the minimum investment required for AEMI?
An increased capital requirement applies to authorised EMIs. In practice, the FCA uses approximately £350,000 as a baseline minimum. In addition, the company must have separate funds to protect customer money, which cannot be used in operational activities.
Is it possible to work in the EU with a British AEMI licence?
After Brexit, an FCA licence does not grant passporting rights in the EU and EEA. To work with clients in these jurisdictions, either a separate EMI licence in one of the EU countries or a corporate structure with a licensed European division is required.
How long does it take to obtain a licence?
With a correctly prepared set of documents, the review process usually takes between 9 and 18 months. The time frame depends on the complexity of the business model, the quality of the materials submitted, and the number of requests from the FCA during the review.
