01 — The capital threshold is real but secondary
Under the Lithuanian transposition of Directive (EU) 2015/2366 (PSD2) and Directive 2009/110/EC (EMD2), an Electronic Money Institution requires initial capital of 350,000 euros, while a Payment Institution requires between 20,000 and 125,000 euros depending on the payment services to be provided. The five-fold difference at the upper end is easy to point at and easy to misread.
The capital figure is a regulatory minimum, not a project budget. The cost of building either authorisation file — corporate, governance, AML and capital — typically exceeds the initial capital threshold for the PI route, and the operating capital that the Bank of Lithuania expects to see on the balance sheet during the authorisation review reflects the size and shape of the intended business, not the floor in the directive.
02 — The functional difference: what you can do with client money
The substantive distinction is operational. A Payment Institution may receive funds from clients only for the purpose of executing a specific payment transaction, and must transfer those funds to the beneficiary at the end of the next business day at the latest. The funds belong to the client throughout, and the institution is a conduit.
An Electronic Money Institution issues electronic money in exchange for funds received. Once issued, the electronic money sits in a client account and can be used to fund future payment transactions, transferred between holders of the same scheme, redeemed for cash. The institution holds client funds on an ongoing basis, subject to the safeguarding requirements of Article 10 EMD2 and the implementing rules of the Bank of Lithuania.
For a business that intends to offer current accounts, prepaid cards, stored-value wallets or any product where the user holds a balance, the EMI licence is the only structurally correct choice. For a business that executes payment instructions and never holds funds beyond the time strictly necessary to settle, the PI licence is sufficient and the EMI authorisation file is over-engineered.
03 — Why the choice matters before the application
The authorisation file is built against the authorisation type from the first page. The business plan, the financial projections, the AML risk assessment, the safeguarding arrangement, the IT architecture description, the governance documentation, and the assessment of the fit-and-proper status of the controllers and directors — each of these is shaped by whether the institution will hold client funds in electronic money form or will only execute payment transactions.
Re-targeting a half-built EMI file towards a PI authorisation, or the reverse, is rarely a saving of work. The Bank of Lithuania has a documented preference for files that are internally coherent, and a file that has been visibly retrofitted is usually treated as a file that needs rebuilding. Operators that approach the Bank with an authorisation request whose category is unclear typically receive a written invitation to clarify the perimeter before the formal review begins — and that clarification is often where the project resets.
04 — The structural decision
For corporate groups designing a new payments or e-money vertical from inception, the practical sequence is: define the product economics first, derive the regulatory category from the product, and only then size the corporate vehicle and the capital required to operate it.
For acquisitions, the assessment runs in the opposite direction. The licence is fixed by what the target holds, and the question becomes whether the business model the buyer intends to operate fits within that perimeter or requires either an extension of the existing authorisation or a re-application as a different category. The cost differential between extending and re-applying is significant, and it should be quantified before the price negotiation, not after.
05 — Where we sit
GLOBALBRIDGE works alongside Regulated United Europe in Vilnius on payment and e-money licensing matters with a Lithuanian perimeter. The licensed legal and regulatory work — drafting, presentation before the Bank of Lithuania, ongoing supervisory interaction — is performed by Regulated United Europe under their own authorisation. The corporate, structuring and documentary work that precedes that engagement — and that, when prepared well, shortens the authorisation timeline materially — is the layer we coordinate.
This note is issued by GLOBALBRIDGE for general informational purposes. It is not legal, regulatory, tax or investment advice. Any reliance on the matters discussed should be confirmed with a licensed professional in the relevant jurisdiction.