Common Pitfalls in Cyprus PSP Licence Applications
Applying for a payment institution or EMI licence in Cyprus is a detailed, document-heavy process, and certain issues come up repeatedly across applications. Recognising these pitfalls early can save applicants significant time and cost.
Underdeveloped Business Plans
A business plan that lacks realistic, well-supported financial projections, or that does not clearly explain how the firm will generate revenue and manage costs as it scales, is one of the most common reasons regulators send applications back for further work.
Mismatched Capital Planning
Applicants sometimes underestimate the ongoing own funds requirements that will apply once the business is operating at scale, only to discover during review that their projected capital position does not comfortably meet the applicable calculation method chosen for their firm.
Vague Safeguarding Arrangements
Applications that describe safeguarding arrangements only in general terms, without a concrete banking relationship or insurance arrangement already identified, tend to attract detailed follow-up questions, since regulators want confidence that client funds will be protected from day one of operations.
Governance Gaps
A management team lacking genuine payments or financial services experience, or an organisational structure where risk and compliance functions are not meaningfully independent from the business, is a frequent source of delay and, in some cases, a barrier to authorisation altogether.
Inconsistent Documentation
Applications where the programme of operations, business plan, and policy documents appear to describe subtly different business models, perhaps because they were drafted at different times without proper cross-referencing, create confusion that slows down the regulator’s assessment.
The Value of Early, Coordinated Preparation
Most of these issues stem from treating the application as a compliance exercise to be completed quickly, rather than as an accurate reflection of a well-thought-out business. Engaging experienced legal and compliance advisers from the earliest planning stages consistently produces stronger, faster-moving applications.
Enalian advises payment institutions, e-money institutions and fintech businesses on licensing, authorisation and ongoing regulatory compliance in Cyprus. If you are exploring a PSP or EMI licence, or need support with an existing authorisation, our team can help. Get in touch with our team to discuss your specific circumstances.
This article is provided for general informational purposes only and does not constitute legal, tax or regulatory advice. Regulatory requirements are subject to change; readers should seek specific advice on their circumstances before taking action.
