Guide to Licensing Payment Organizations
Regulation
The licensing of payment organizations (hereafter "POs") and their activities are regulated by the Law of the Republic of Armenia "On Payment Systems and Payment Organizations" (hereafter "the Law"), as well as Regulation 17/01, Regulation 17/02, and Regulation 17/03, approved by the Central Bank of Armenia (CBA) Council, and other legal acts listed in Article 2 of the Law.
Description
A PO is a legal entity licensed to provide payment services as defined by the Law and normative legal acts of the Central Bank.
The types of licenses for POs include:
- Execution of money transfers
- Processing and clearing of payment instruments and settlement documents
A PO can obtain these licenses either separately or simultaneously. The types of licenses and the services provided are regulated by Article 19 of the Law.
To obtain permission to issue electronic money, a PO must have a money transfer license. The issuance of electronic money is regulated by Regulation 16/1 and Regulation 16/2.
Licensing Procedure
To obtain a license to provide payment services, a PO must first be registered as a legal entity with the State Register of Legal Entities of the Ministry of Justice of Armenia. After this, the registered legal entity may apply to the Central Bank to receive a payment services license.
To apply for a PO license, a legal entity must submit to the Central Bank an application and the required documents, including:
- Founding documents
- Information about the managers and participants
- An economic plan and operational regulations
- Necessary documents regarding funds and total capital
- And other documents (the full list is provided in Article 20 of the Law and Chapter 3 of Regulation 17/01).
The application and the required documents for obtaining a PO license must be submitted in electronic format, attached to a signed recommendation letter (application) in the format specified by Regulation 17/01.
The Central Bank will license the PO or reject the application within two months from the receipt of the required documents, providing the applicant with a corresponding decision.
The Central Bank may reject the application for a payment organization license as per Article 20.1 of the Law.
Capital and Participants
POs must meet the economic norm of having a minimum total capital of 100 million AMD.
A participant holding 10% or more of the voting rights in a PO cannot have a criminal record for an intentional crime.
Managers
The managers of a PO are considered to be the executive director, deputy director, and chief accountant, and the requirements for these roles are defined by Article 22 of the Law.
Premises
The premises and technical equipment used by a money transfer organization must comply with the requirements set out in Chapter 4 of Regulation 17/01.
Technical and Software Support
A PO must have technical and software systems in place that meet the requirements outlined in Chapter 5 of Regulation 17/01 to support its current operations.
Duties
For licensing, the PO must pay the duty specified by Article 19 of the Law "On State Duty" of the Republic of Armenia, with the following rates per year:
- For executing money transfers: 1,000,000 AMD
- For each branch of a money transfer organization: 50,000 AMD
- For processing and clearing payment instruments and settlement documents: 1,000,000 AMD
There is no separate duty for the issuance of electronic money.
Attention: This document is a summary of the requirements set out in the legal acts regulating the activities of POs. For more detailed information, it is necessary to review the full text of the legal acts in force. The Central Bank may also request additional information and supporting documents if needed.