Buying an EMI or payment institution: acquisition versus applying from scratch

Who this guide is for: Founders, investors, corporate development teams and boards considering whether to apply for an e-money or payment institution licence or acquire a firm that already holds one, in the UK or the EU.

The two routes

Applying for a licence means building the business plan, governance, capital, safeguarding, financial crime framework and systems, then waiting for the regulator to assess them. In the UK, the FCA must decide a complete application within three months and any application within twelve, but preparation and the regulator's questions mean most applicants should plan for a year or more from start to authorisation. EU timelines vary by regulator.

Buying an authorised firm replaces that process with a change of control. Anyone acquiring a qualifying holding, generally 10% or more, needs the regulator's approval before completion. In the UK the FCA can take up to 60 working days to assess a complete notification, and longer if it asks questions. You also need the firm's banks, safeguarding providers and card schemes to continue the relationship under new ownership.

What you actually inherit

• Permissions and passporting: exactly what the firm may do, and where.
• Clients and their risk: sectors, concentration, the quality of client files and any history of difficult relationships.
• Safeguarding: how funds are held and reconciled, the safeguarding banks and the audit history.
• Controls and record: financial crime framework, monitoring, breaches, remediation and correspondence with the regulator.
• People: the approved individuals, MLRO and compliance team, and whether they will stay.
• Contracts: scheme memberships, BIN sponsorship, processors and outsourcing, with their change of control and termination terms.

Cost and time compared

A fresh application costs less upfront but takes longer, and the outcome is uncertain until authorisation. An acquisition costs more and carries legacy risk, but can be quicker if the target is clean and its key partners are willing to continue. The honest comparison is not licence against licence. It is the total time and cost to reach a working business with banking, safeguarding and scheme access in place, under each route.

Questions to answer before you commit

• Does the target's licence and passporting cover the business you actually intend to run?
• Will its safeguarding banks and card schemes continue after completion, and on what terms?
• Are there open regulatory matters, remediation programmes or restrictions?
• Which client relationships would you keep, and which would you exit?
• Will the key approved individuals stay through the change of control and beyond?
• How will the regulator view you, your ownership chain and your business plan?

The EU timing question

In the EU, the PSD3 and Payment Services Regulation package will fold e-money into the payment services regime and require existing EMIs and payment institutions to be re-authorised within a transitional period. A buyer should understand where any EU target stands and what re-authorisation will involve. See our guide to what PSD3 and the PSR change.

How we help

We help acquirers screen targets, test the payments side of due diligence and plan the change of control and partner conversations, alongside your corporate finance and legal advisers. See M&A and transactions.

This guide is general information based on our experience and public sources, reviewed in October 2026. It is not legal, regulatory, tax or financial advice and does not constitute a legal opinion. Regulations and market practice change; you should obtain your own independent professional and legal counsel before acting on anything in it. 7 Seas Consultants Ltd holds no payment licence and is not authorised by the FCA or any other regulator.