🇪🇺Lending licences: EU, UK, Hong Kong, Singapore and Kazakhstan

Concept

A lending licence is the state's permission to make loans as a business. A non-bank lender lends its own money or money borrowed in the markets and holds no one's deposits, so regulation turns to the borrower: the cost of credit, the borrower's ability to repay and whether the debt can be enforced. The boundary with banking is deposits: an AIFC Credit Provider, for example, may fund itself in the capital markets but is expressly barred from taking deposits (BBR rule 1.7).

Hence the map's central rule: the borrower determines the regime. Consumer credit is licensed in all five jurisdictions covered (in the EU under CCD2 from 20 November 2026); lending to companies is wholly or partly outside licensing in many regimes, and each jurisdiction draws that line differently.

One lender, two countries

A platform lending to small businesses in the UK and Hong Kong needs a licence for some borrowers and not for others, and the line falls on different criteria: borrower type and amount in the UK, company capital in Hong Kong (RAO arts 60B and 60C, Cap. 163).

The same product line needs a licence in one country and none in the other, and misclassifying a borrower turns a lawful business into an unlicensed one.

Crypto-asset lending is treated with the crypto regimes in “Crypto Licences by Jurisdiction”; payment, e-money and bank regimes are in “Financial Licenses by Jurisdiction”, and US lending through a partner bank in “Rent-a-Bank and True Lender”. The borrower's side of credit is covered in “Lombard Lending”, “Borrow Against a Collection or Sell” and “Lending in China”. The “Financial licences” hub places lending among the other financial licences.

The map: eight regimes on seven axes

Eight regimes — three EU layers, the UK, Hong Kong, Singapore and two in Kazakhstan — are compared on seven axes in three tables over the same rows: scope, entry, operating conditions. The first shows who grants the permission, what is licensed and what stays outside.

The second table covers entry: a fixed capital minimum appears in two rows, and timelines run from 30 working days to a moratorium in place since 2012.

The third table shows what the licence allows once granted: the price and exposure limits, and whom the lender may serve and how.

What the map shows

Where the map names a capital figure — KZT 200 million for a Kazakh MFO, US$2 million for an AIFC Credit Provider — it is a hard threshold; Hong Kong's Ordinance sets none. Elsewhere entry is made costly by Singapore's moratorium, Hong Kong's court procedure, FCA timelines and, in the EU, the absence of a passport.

Territory is the main constraint. A non-bank lender's licence covers one country, and in Hong Kong and Singapore in practice one set of premises, so a multi-market lender either holds a licence in each market or keeps to borrowers who need none. The only pan-EU route for non-bank credit unconnected with payment services is AIFMD II, open only to a fund.

Price caps appear wherever the state expects a retail borrower. Set per year, month or day, or as a total-cost ceiling, they cannot be compared directly.

European Union

The EU has no single lending licence. From November 2026 Union law requires national admission for consumer credit; it barely touches business lending and harmonises lending by funds.

Consumer credit: CCD2 from 20 November 2026

The new Consumer Credit Directive (CCD2) requires every Member State to subject creditors and credit intermediaries to an admission process, registration and supervision by an independent competent authority (CCD2 art. 37(1)).

Admission is national, and the directive creates no EU-wide licence for a non-bank creditor. From 20 November 2026 consumer credit in the EU therefore needs admission in each country of operation unless a bank grants it or it is tied to a payment or e-money institution's payment services. The reform of EU payments law is covered in “PSD3 and PSR”, and CCD2 and BNPL in detail in a separate article on consumer credit.

Business lending: national regimes without a passport

Lending to companies by non-banks is largely unharmonised. The EBA found that some Member States require a specific authorisation or registration, others apply only activity-based rules, and in some the activity may be unregulated (EBA, 2022). A non-bank lender needs no authorisation under the CRD or other EU sectoral law unless its wider financial activities or national rules require one. The rules sit on three layers.

A stand-alone non-bank lender therefore works under the rules of each country where it lends; how the passport works for licensed firms is explained in “EU Passporting”. CRD VI targets firms that would both take deposits and lend: any non-EU firm needs a branch to take deposits, with exceptions for reverse solicitation, services to credit institutions and intra-group services. A non-EU lender that takes no deposits falls outside the rule and stays within national regimes.

Loan-originating funds under AIFMD II

AIFMD II recognised the right of alternative investment funds to originate loans and harmonised the rules for their managers so that such funds can lend in every Member State (Directive 2024/927, recital 13). The licence is the manager's (AIFM) authorisation; loan origination remains the fund's activity. A loan-originating fund is one whose strategy is mainly to originate loans, or whose originated loans are at least 50% of its net asset value.

The single-borrower limit applies from the date set in the fund rules, and no later than 24 months after the first subscription. For private credit this is the widest route on the map, at the price of leverage and concentration limits and a duty to keep part of the risk. Security for such loans is covered in “Private Credit and Security Interests”, and hiring a manager in “Third-party ManCo in the EU”.

United Kingdom: consumer credit and BNPL

The UK regime is built around the consumer: the FCA does not license lending to companies. Consumer credit has one authorisation with two levels and, since July 2026, a perimeter for interest-free instalment credit.

The perimeter: individuals, small partnerships and the £25,000 threshold

Entering into a regulated credit agreement as lender, and exercising the lender's rights and duties under it, are regulated activities requiring FCA authorisation (RAO art. 60B). The borrower decides first whether a loan is inside.

A compliant borrower declaration of business purpose creates a presumption of exemption unless the lender knows or suspects otherwise. The overseas persons exclusion in RAO art. 72 covers dealing, arranging, advising and certain home-finance activities but names neither lending under art. 60B nor broking under art. 36A, so a foreign lender to UK consumers cannot rely on it. A UK-incorporated applicant must have its head office and registered office in the UK (FSMA Sch. 6 para 2B).

Permission, fees and timing

Consumer lending authorisation comes as Limited Permission or Full Permission. Limited Permission is open only to local authorities and to suppliers that charge no interest or other charges, outside hire-purchase and conditional sale; interest, late-payment fees or default charges mean Full Permission (FCA). Fees below follow the FCA fee schedule and timings the FCA's Q4 2025/26 service metrics.

By statute the FCA must decide a complete application within six months and an incomplete one within twelve (FSMA s.55V); since January 2026 it has measured itself against faster targets of four and ten months, with the statutory deadline unchanged (FCA). The general mechanics of UK authorisation are in “UK FCA Authorisation Map”.

Deferred payment credit (DPC) since 15 July 2026

Deferred payment credit — interest-free credit repayable in 12 or fewer instalments within 12 months, which the market calls BNPL — became FCA-regulated on 15 July 2026 under SI 2025/859; the FCA's final rules are in PS26/1 of 11 February 2026. Lenders financing a purchase from a merchant are regulated; a merchant offering its own deferred payment is not.

All credit broking of DPC agreements is excluded from the credit broking activity, including by domestic-premises suppliers (SI 2025/1154). A firm holding an art. 60B permission before 15 July 2026 is treated as permitted for DPC. Everyone else's position, per the FCA, is as follows.

Only a firm that was carrying on DPC on 15 July 2025, notified the FCA between 15 May 2026 and two weeks before Regulation Day (that is, by 1 July 2026) and paid the fee could enter the temporary regime (PS26/1). That window has closed.

Price caps

High-cost short-term credit has its own price regime: charges may not exceed 0.8% of the credit per day, total charges may not exceed the amount borrowed, and default charges are capped at £15 (FCA CONC 5A.2).

Hong Kong: the Money Lenders Ordinance (Cap. 163)

Hong Kong licenses money lenders through the courts: a court grants the licence, the police vet the applicant, and the licence covers specific premises. No person may carry on business as a money lender without a licence, at premises other than those it specifies, or in breach of its conditions (Cap. 163 s.7). A money lender is anyone whose business is making loans or who holds himself out as such, other than the persons and loans in Schedule 1. For a lender with no Hong Kong office, the premises requirement is a serious practical obstacle.

The licence: Registrar, police and court

The Ordinance sets a procedure in four stages.

1. The application goes to the Registrar of Money Lenders, a role performed by the Registrar of Companies, with a copy to the Commissioner of Police, who may investigate (Companies Registry).
2. Until 60 days have passed or the police investigation is complete, whichever is earlier, the Registrar takes no step beyond registering the application.
3. The application goes to a magistrate sitting as the licensing court; the hearing is set on at least 14 clear days' notice.
4. Without objection the court grants the licence; if the Registrar, the police or a third party objects, it examines the fitness and propriety of the applicant, its controllers and managers, the premises and the public interest.

A licence runs for 12 months; renewal is sought in the three months before expiry through the same procedure. Since 3 March 2025 each application includes a business plan covering the applicant's understanding of the business, source of funds, resources and readiness to comply with the Ordinance, the licensing conditions and AML/CFT rules (Registrar's guideline). Cap. 163 sets no minimum capital for a money lender.

Rates: 48% and 36% since 30 December 2022

Hong Kong caps rates through the criminal law and through the court's power to reopen an extortionate bargain. Both thresholds have applied since 30 December 2022, replacing 60% and 48% (Hong Kong Government).

The criminal cap binds licensed and unlicensed lenders alike, so the company-loan carve-out in s.24(5) matters to every B2B lender.

Exemptions: banks and loans to companies

The Ordinance does not apply to authorized institutions under the Banking Ordinance — banks, restricted licence banks and deposit-taking companies (s.3); their subsidiaries and certain recognised overseas banks are exempted persons under Schedule 1. Exempted loans include loans to a company with paid-up share capital of at least HK$1 million, to listed companies and their subsidiaries, within a group, and by a business not mainly engaged in lending (Schedule 1, Part 2).

The exemption attaches to the loan: a lender that also lends to individuals needs a licence for those loans. For a B2B lender the shortest lawful route in Hong Kong is to lend only to exempt borrowers. Hong Kong's other licences and regulators are collected in “Hong Kong: Companies, Residency, Banking and Licences”.

Licensing conditions 2025–2027 and the market

The rules for money lenders are being tightened in phases (licensing conditions, April 2026 edition; Hong Kong Government, 1 August 2026).

The market is shrinking: 1,943 licensed money lenders in August 2026 against 2,395 in 2020, with 91 new licences granted in January–August 2026 (Companies Registry).

Singapore: the Moneylenders Act 2008

Singapore has accepted no new moneylender licence applications since 2012 and takes lenders dealing solely with corporations or solely with accredited investors outside the Act. Anyone else who lends money in consideration of a larger sum being repaid is presumed to be a moneylender until the contrary is proved and needs a licence from the Registry of Moneylenders at the Ministry of Law (Registry of Moneylenders).

The moratorium on new licences

On 12 March 2012 the Registry suspended new licence applications pending its review of the moneylending laws (Ministry of Law). As at September 2026 the suspension remains, and no additional places of business are approved either. The market can be entered by buying a licensee — new directors, managers and substantial shareholders need the Registrar's prior approval (“Change of Control: Buying a Licensed Financial Company”) — or by operating outside the Act as an excluded moneylender or under an exemption.

A licence runs for 12 months. The application fee is S$600 (new licences only), the licence fee S$1,500 a year per place of business, and renewal requires a banker's or insurance guarantee of S$20,000 covering the licence period.

Caps and face-to-face lending

The price rules have applied since 1 October 2015 regardless of the borrower's income or of whether the loan is secured; the unsecured borrowing limits count all moneylenders together (borrowers' guide).

The second constraint is the channel. Before approving a loan, the licensee must meet the applicant in person at its approved place of business and check identity against the original document (condition 17 of the licence conditions); loans concluded fully online or elsewhere are disallowed. A digital consumer-lending model cannot run on a Singapore moneylender's licence.

Excluded moneylenders and exemption

The Act does not apply at all to a person who lends solely to accredited investors within the meaning of s.4A of the Securities and Futures Act 2001 ([2025] SGHC 217); the thresholds for that status are covered in “Accredited and Qualified Investor”. A person who lends solely to corporations is also an excluded moneylender. A single loan to an individual takes the lender out of the exclusion, and all its loans then count in deciding whether it needs a licence ([2024] SGHC 234).

A mistake is costly: a loan by an unlicensed moneylender is unenforceable, and money paid under it cannot be recovered in court (s.19(3), 2020 Revised Edition). The alternative to exclusion is a certificate of exemption under s.91(1), valid for up to three years, with an annual fee of S$3,000 for personal or consumer loans only, S$1,000 for other loans and S$4,000 for both.

Singapore's tax, banking and residence questions are collected in “Singapore: Business, Investments, Residence and Banking”.

Kazakhstan: MFOs and the AIFC

Kazakhstan runs two regimes with different logic. On the national market non-bank credit comes from microfinance organisations supervised by the ARDFM, in tenge and under strict price caps; in the AIFC the AFSA licenses Providing Credit, with capital in dollars and no deposit-taking.

Microfinance organisations

Non-bank lending on the national market is microfinance activity, carried on by three types of organisation (Law on Microfinance Activity). Amounts in MCI (monthly calculation index) are converted at the 2026 value of KZT 4,325 (budget law); capital figures come from the prudential standards resolution.

The ARDFM issues the licence within 30 working days of a complete file, and a legal entity must apply within six months of its registration. An MFO is a joint-stock company or a business partnership such as an LLP. Besides microcredit it may carry on only the operations listed in the Law — borrowing from residents and non-residents, investing its own assets, leasing, factoring, forfaiting, guarantees to legal entities, acting as payment or insurance agent — and no other business.

For a lender entering from abroad, three rules of the Law matter most:

• microcredit is granted only in tenge;
• an online agreement with an individual requires biometric authentication;
• a person registered, resident or located in an offshore zone on the ARDFM list may not be a major participant holding 10% or more.

The chief executive needs at least three years' experience, including at least one in management. The prudential ratios are capital adequacy k1 of at least 0.1, single-borrower risk k2 of no more than 0.25 of own capital, and leverage k3 of no more than 10.

The 2026 APR cap

The price of credit is capped by the maximum annual effective rate (APR), set by a joint resolution of the ARDFM and the National Bank of 28–29 April 2026 as amended on 30 June 2026 (text); short microcredits are also subject to the ARDFM's requirements on contract terms (requirements).

The MFO cap equals the cap on unsecured bank loans, so a non-bank lender can price risk higher only in the short segment of up to 45 days.

AIFC: the Credit Provider

Inside the Astana International Financial Centre, Providing Credit — providing a credit facility to another person — is a regulated activity licensed by the AFSA. Credit provided incidentally to dealing as agent, arranging deals, managing investments or a fund, or custody is carved out; advising on and arranging a credit facility are separate activities (AIFC General Rules).

A licensed firm that is not a bank is a Credit Provider: it may raise funds through debt instruments of any type on capital or money markets but must not accept deposits (BBR). Capital and fees depend on the activity (Fees Rules).

The AFSA puts its average processing time at around two to three months from a materially complete application, with an initial review letter within four weeks (AFSA); this is the regulator's own estimate, not a statutory deadline. The centre's law and tax regime are covered in “AIFC”, and banking and business in the country in “Kazakhstan”.

How to choose a regime

The choice runs through three filters: who the borrower is, where the borrower is and what the product costs. A consumer brings a licence almost everywhere while a company often removes the need for one; territory then limits the lender to one country, and the caps in Hong Kong, Singapore, Kazakhstan and on UK high-cost short-term credit rule out high-yield models in advance.

Lending to companies needs fewer permissions than consumer lending almost everywhere, but only with discipline over who the borrowers are. The cheaper narrow routes — UK Limited Permission, Hong Kong exempted loans, a Singapore s.91 certificate, a Kazakh pawnshop or credit partnership — work only while the product stays within their narrow circle of borrowers or charges.

Popular, but ends badly

The costliest mistake on the map is cross-border consumer lending without a local licence.

The other practices look lawful on paper but each breaks on a specific rule.

Each of the seven runs into a statutory rule or a licence condition, and contract drafting does not change the result.