🇪🇺EMI and Payment Institution Licences in Bulgaria: the BNB Regime

Bulgaria has two kinds of non-bank payment firm, and the Bulgarian National Bank (BNB) licenses and supervises both: the payment institution (PI), which moves other people's money, and the electronic money institution (EMI), which can also hold it as stored value. The BNB register of e-money institutions, last updated on 23 September 2026, lists 13 EMIs, and the payment institution register of 31 August 2026 lists five PIs. It is a small market whose position changed when Bulgaria joined the euro area on 1 January 2026.

Payment and e-money institutions under ZPUPS

Why the regime exists

The EU created the payment institution and the EMI so that payments and stored value could be offered without a banking licence. Bulgaria implements both categories in one statute, the Payment Services and Payment Systems Act (ZPUPS), promulgated in March 2018 to transpose PSD2. The bargain is visible in the text.

A PI or EMI takes no deposits and may grant only short-term credit tied to payment services, never funded from money received for e-money. In exchange it needs a fraction of a bank's capital and, once licensed, can serve the rest of the EEA on a notification to the BNB. Client money is protected by ring-fencing rather than by deposit insurance.

Two licences, two money models

The two licences differ in what happens to the client's money between the moment it arrives and the moment it leaves.

The difference drives most of the regime. A PI holds client money only while a payment is being executed, so its initial capital scales with the riskiest service it offers, from €20,000 for money remittance to €125,000 for accounts, transfers and cards. An EMI carries a standing liability to every holder of its e-money, so it starts at €350,000 of initial capital and must keep own funds of at least 2% of its average outstanding e-money. It may not accept deposits or other repayable funds, nor pay interest or any other benefit linked to how long e-money is held.

What is specific to Bulgaria

Four features separate a Bulgarian licence from the same EU licence issued elsewhere.

The first is currency. Bulgaria has been a euro-area member state since 1 January 2026, its thresholds are set in euro, and the country has access to the full suite of TARGET services. An amendment in force since 5 August 2025 gives a BNB-licensed PI or EMI a statutory route to apply for participation in a settlement-finality payment system: a precondition for direct access to central-bank settlement, which still has to be obtained separately.

The second is that only the full licence exists. ZPUPS contains no small-institution waiver of the kind PSD2 and EMD2 let member states offer, so a start-up with modest volumes goes through the same authorisation as an established issuer.

The third is presence. The registered seat must coincide with the place where management is actually carried out, and the applicant must carry out at least part of its payment-service activity in Bulgaria. A licence run from abroad through an address in Sofia does not meet that test.

The applicant itself must be a limited-liability or joint-stock company (ZPUPS Art. 10(4), applied to EMIs by Art. 37(2)), which makes forming and running a company in Bulgaria part of the licensing project.

The fourth is scale. With 13 EMIs, three of them licensed in 2026, the register is small but growing.

The regime as it stands in September 2026:

Capital and own funds

ZPUPS separates the entry ticket from the running requirement. Initial capital must be in place when the licence is granted; own funds must stay above a calculated floor for as long as the institution operates. ZPUPS Arts 8 and 38 set the entry figures, stated in euro since 1 January 2026:

For an EMI that figure is only the floor. For issuing e-money, own funds must equal at least 2% of the average outstanding e-money, averaged over the end-of-day balances of the preceding six calendar months. For any payment services the EMI provides that are unrelated to e-money, the PI method applies on top.

Own funds may never fall below the €350,000 of Art. 38, whatever the formula produces. On the basis of its risk assessment, the BNB may require an EMI to hold up to 20% more than the calculated amount, or allow it up to 20% less (Art. 39(6)).

Older commercial material still quotes BGN 700,000. That was the pre-euro figure in Art. 38, about €357,900 at the fixed conversion rate of 1.95583; from 1 January 2026 the statute states €350,000.

None of these figures originates in Sofia. Art. 4 of EMD2 fixes EMI initial capital at €350,000 and Art. 7 of PSD2 the three payment-institution tiers, so every EEA member state opens at the same number and the choice between them is decided by everything except capital. What Methods A to D then do to that number once the business has volume, and how the same arithmetic runs in investment, crypto and banking regimes, is worked through in regulatory capital.

How the BNB licenses an EMI

The EMI procedure borrows the payment-institution rules: ZPUPS Art. 37(2) applies Arts 10–13 to e-money licences, and BNB Ordinance No. 16 sets the document list for both. The licensing conditions go beyond paid-up capital. The applicant needs clear governance, risk management and internal control, ICT arrangements consistent with DORA, and reliable internal controls for anti-money-laundering and counter-terrorist-financing duties. A PI or EMI is also a financial institution under Art. 3(2) of the Credit Institutions Act, which makes it an obliged entity under Art. 4 item 3 of the Measures Against Money Laundering Act. It must therefore set up a specialised AML service headed by a senior manager within four months of the licence (Art. 106(1), (2) and (4)) and give the Financial Intelligence Directorate of the State Agency for National Security the head's name within seven days (Art. 106(5)); the lighter Art. 107 route is not available to it. The whole regime is set out in AML in Bulgaria.

ZPUPS Art. 11 fixes the sequence:

1. The applicant files with the BNB, with the documents under Ordinance No. 16 and the review fee.
2. The BNB examines the file and decides within three months of receipt.
3. If the file is incomplete, the BNB asks for the missing documents and gives up to two months to supply them.
4. The BNB then decides within three months of receiving the missing documents.
5. A licensed institution enters the public register kept under Art. 19; its agents must be entered before they start work.

These are maximum periods for the regulator's decision, not a forecast of the route: the statute fixes the three months of Art. 11, and how long it takes to assemble a file the BNB treats as complete depends on the applicant. Regulators that publish processing data of their own show how far practice can run past a statutory clock. The Bank of Lithuania gives three months from proper documents; the FCA's median determination time for payment and e-money authorisations was 207 days in the fourth quarter of 2025/26; and the Central Bank of Ireland met its standard of 90 business days per assessment phase while its average file took 763 days in 2025. Those three are set beside fifteen more in the map of payment regimes by jurisdiction, which compares eighteen of them on capital, published timeline, safeguarding, passporting, agents, crypto overlay and reporting.

Owners and controllers

Ownership stays under supervision after licensing. Acquiring or increasing a holding so that it becomes qualifying or reaches 20%, 30% or 50%, or so that the institution becomes a subsidiary, requires prior BNB approval on a written application under Art. 14, which Art. 44 applies to EMIs. The BNB decides within two months, and a request for further information of up to two months stops the clock. It assesses the acquirer's reputation, the fitness of the managers it will appoint and its financial soundness, the same qualifying-holding and fit-and-proper test that financial regulators apply across sectors.

Transactions, decisions and acts carried out without the required approval are void under Art. 14(10). Separately, anyone who acquires 3% or more of the shares or voting rights must notify the BNB within seven days (Arts 14a and 44a).

Once licensed, PIs and EMIs submit annual financial statements audited by a registered auditor within seven days of the audit report and no later than 30 June of the following year.

Safeguarding: how client money is protected

Safeguarding takes the place of deposit insurance. A PI providing services under Art. 4 items 1–6 keeps client funds apart from its own and, if they have not been passed on by the end of the business day after receipt, deposits them in a separate safeguarding account with a bank licensed in a member state or with a member state's central bank. A PI offering only payment initiation never holds client funds and has no such account.

The diagram shows where e-money funds sit once they are safeguarded.

An EMI applies the same measures to funds received in exchange for e-money. Money paid by card or another payment instrument becomes subject to safeguarding once it is credited to the EMI's payment account, and in any case no later than five business days after the e-money is issued. Money on a safeguarding account cannot be attached or enforced against for the institution's debts to anyone other than its payment-service users. If the institution becomes insolvent, those funds are excluded from the insolvency estate and returned by the trustee to users pro rata. No deposit guarantee scheme stands behind an EMI balance.

What the competing structures actually deliver when the operator fails — a segregated pool with user priority, a trust, an insurance policy or a third-party guarantee — is compared regime by regime in correspondent banking and client-money protection, and the onboarding side, how a correspondent takes on and keeps a licensed firm, in banking for licensed operators.

Agents, distributors and the EU passport

An EMI's reach beyond its own staff runs through three intermediary roles, and ZPUPS treats them differently. An EMI may not issue e-money through agents; issuance stays with the licensed institution. It may, however, distribute and redeem e-money through merchant representatives acting in its name, and provide payment services through agents.

Agents cannot start before the BNB has entered them in the Art. 19 register, and the BNB registers or refuses within two months of a complete application. For activity in another member state, through a branch, an agent established there or directly, the institution notifies the BNB, which forwards the notification to the host authority within one month. Agent networks and passporting run on EU-wide rules, which payment agents and passporting follows across member states.

The euro, TARGET and Art. 130a

The euro changed the settlement setting for Bulgarian payment firms. Council Regulation (EU) 2025/1409 fixed the conversion rate at 1.95583 levs to the euro, and on 1 January 2026 Bulgaria became the 21st euro-area member state, with access from the same day to the full suite of TARGET services: T2, TIPS, T2S and ECMS.

Access for non-banks has a separate legal basis. Regulation (EU) 2024/886 amended the Settlement Finality Directive and PSD2 so that payment institutions and EMIs may participate in designated payment systems, and since October 2025 non-bank PSPs meeting the TARGET Guideline requirements can access T2 and TIPS. Bulgaria added Art. 130a to ZPUPS: a BNB-licensed PI or EMI that wants to join a settlement-finality system applies to the BNB, which rules within two months of a complete application.

The register and the market

The Bulgarian e-money sector is concentrated, which makes the register easy to read. Its two oldest licences date from July 2011, and it grew by three in 2026. Payment institutions are fewer still: five on the register stamped 31 August 2026 (Transcard Financial Services, BORICA, Datecs Payment Technology, Iris Solutions and Octis Pay).

The three 2026 licences, Monesso EOOD (22 April), Transactiz OOD (14 May) and MUVU Bulgaria EOOD (27 August), came after the euro changeover. The usual point of comparison is Lithuania: the Lithuanian EMI licence and the side-by-side comparison of the two regimes show where they differ.

E-money tokens and MiCA

The EMI licence is also the entry point to e-money tokens. Under MiCA Art. 48(1) an e-money token may be offered to the public or admitted to trading in the EU by its issuer only if the issuer is authorised as a credit institution or an EMI; other persons may do so with the issuer's written consent. For issuers seated in Bulgaria, the competent authority for that regime is the BNB, under Art. 182a of ZPUPS inserted in 2025. The Crypto-Asset Markets Act of the same year makes the Financial Supervision Commission (FSC) the general MiCA authority, one of the points where Bulgaria's financial licences divide between the BNB and the FSC. That Act does not apply to EMT issuers, except for the requirements under Title VI of MiCA (market abuse).

Sanctions constraints on the customer base

EU sanctions bear mainly on whom an EMI may serve. Since 24 October 2025, when the 19th package (Regulation (EU) 2025/2033) took effect, Art. 5b(2) of Regulation 833/2014 has prohibited issuing e-money, issuing payment instruments, acquiring and payment initiation for Russian nationals, natural persons residing in Russia and legal persons established in Russia. EU, EEA and Swiss nationals, and holders of an EU, EEA or Swiss residence permit, are exempt. The prohibition does not force existing accounts to close, but the prohibited services must stop for every in-scope customer.

Ownership is a separate question. EU sanctions contain no general ban on Russian nationals owning or controlling an EMI, but one rule reaches EMIs that provide crypto-asset services. Art. 5b(2a) of Regulation 833/2014 bars Russian nationals and natural persons residing in Russia from owning or controlling, or holding any post in the governing bodies of, an EU entity that provides crypto-asset wallet, account or custody services. That ban has applied since 18 January 2024 (Regulation (EU) 2023/2878) and, since 25 August 2026, covers any other crypto-asset service as well (Regulation (EU) 2026/1848).

An EMI that holds or transfers its own e-money tokens for clients under MiCA Art. 60(4) provides such services, so the ban applies to it; the Art. 5b(3) exemption for EU, EEA and Swiss nationals and residence-permit holders covers this rule too. Otherwise ownership of an EMI is tested through the qualifying-holding and fit-and-proper review described above.

Risks and open questions

Two developments sit outside the licensing file but affect the value of a Bulgarian licence.

The FATF listing is the nearest. Bulgaria has been under increased monitoring since October 2023; at its June 2026 plenary the FATF made the initial determination that the action plan is substantially completed, which triggers an on-site assessment before the country can be removed from the list.

The EU payments reform is the largest. PSD3 and the Payment Services Regulation would fold the EMI regime into the payment institution regime. Both files, PSD3 and the PSR, are still awaiting the Council's first-reading position after the ECON committee approved the agreed text on 5 May 2026, and neither is in force.