The Polish Ministry of Finance has produced a proposal for an amendment to the Act on Payment Services, which is now being submitted for consultations. One of the proposed amendments concerns the activities of small payment institutions (SPI) with regard to AML compliance and notification obligations towards the Polish Financial Supervision Authority.
Under the current Act on Payment Services in Poland, payment services may be provided in the form of an SPI, due to an exemption that member states can apply in their national laws under article 32 of Directive (EU) 2015/2366 of the European Parliament and of the Council (PSD2). Under article 32, member states may introduce, in their national legal systems, an additional type of payment service provider that is less stringently regulated, while certain restrictions will continue to apply to business operations of that kind, for instance:
- the payment services provided by the SPI do not include payment initiation services (PIS) and account information services (AIS);
- the monthly average value of transactions executed in the preceding 12 months may not exceed EUR 1.5 m (under PSD2 this limit can be set at EUR 3 m);
- total amount of funds on the payment account held by SPI for one payment service user shall not exceed EUR 2.000;
- small payment institutions may only operate within Poland.
An SPI has become a popular form of activity among firms in the FinTech sector that launch payment services. To date, more than 90 firms of this kind have been registered with the Polish Financial Supervision Authority. The registration process as an SPI may take even up to 3 months. When the transaction thresholds described above are exceeded, an SPI may apply to the Polish Financial Supervision Authority for a license to provide services as a payment institution. An SPI may continue to operate until the application is reviewed, and is not required to observe the transaction thresholds described above.
Under the legislative proposal of 11 January 2021, SPIs will be subject to the requirement to submit to the Polish Financial Supervision Authority, when applying to be registered as a SPI, information regarding the AML compliance procedures and information concerning any other activity (hybrid small payment institution). In order to demonstrate compliance with the requirements for the protection of users’ funds, an SPI shall provide to the regulatory authority a copy of the payment account agreement used by SPI to execute payment transactions. The amendments described above are aligned with a certain shift in the approach taken by the Polish Financial Supervision Authority to entities of this kind, and with a policy of more extensive financial regulation of these entities, even during the registration proceedings.
The changes envisaged in the proposal also include further limits on transactions effected by payment service offices (firms only authorized to provide money transfer services), while for these entities, the requirements and regulatory obligations will be eased. Those changes shall simplify and improve the conduct of operations by these market participants.