European Union · Licensing guide
Payment Institutions and E-Money Institutions in the EU
The PSD2 and EMD2 framework for payment and electronic-money licences, and passporting across the EEA.
Last reviewed 23 Oct 2026 by the Fintech Headlines desk against the official sources listed below.
Legal framework
Payment services are governed by the revised Payment Services Directive (Directive (EU) 2015/2366, "PSD2"), and electronic money by the second E-Money Directive (Directive 2009/110/EC, "EMD2"), each transposed into national law.
The European Commission proposed a third Payment Services Directive (PSD3) and a Payment Services Regulation (PSR) in June 2023; check the current legislative status before relying on either.
Licence types
A payment institution (PI) may provide the payment services listed in Annex I of PSD2, such as money remittance, acquiring and issuing payment instruments, and — with the relevant permissions — payment initiation and account information services.
An electronic money institution (EMI) may issue e-money and also provide payment services. Minimum initial capital and safeguarding requirements differ by licence type and service.
Passporting
Once authorised by its home national competent authority, a PI or EMI may provide services in other EEA states under the freedom to provide services or establishment, following the notification procedure.
Official sources
This guide is general information, not legal advice. Rules change; confirm current requirements with the competent authority or qualified counsel.