Electronic Money Institutions (EMIs), previously regulated under the Banking Act (Chapter 371 of the Laws of Malta) are now regulated by the Financial Institutions Act (Chapter 376 of the Laws of Malta) (the “Act”) and Regulations issued thereunder.

The Third Schedule of the Act defines an EMI as “a financial institution that has been licensed in accordance with this Act and authorised to issue electronic money or that holds an equivalent authorisation in another country in terms of the Electronic Money Directive to issue electronic money.”Moreover, the definition of electronic money includes “electronically, including magnetically, stored monetary value as represented by a claim on the issuer which is issued on receipt of funds for the purpose of making payment transactions… and which is accepted by a natural or legal person other than the financial institutions.

Unlike credit institutions, it is not permissible for Electronic Money Institutions to carry out lending and other bank related activities and they can only invest in very liquid marketable assets.
The minimum paid up capital for an electronic money institution has been set at Euro 350,000.

Advance revenue rulings may be obtained as to the tax treatment of transactions involving financial instruments and international business. These rulings apply for 5 years and may be renewed for a further 5 years. Such rulings also survive any change in the relevant legislation for a maximum period of 2 years.

Various fiscal incentives are available to Electronic Money Institutions upon particular criteria being satisfied.

EMD assists clients with the Licensing of Electronic Money Institutions and provides consultancy and support services throughout the EMI application process and on an ongoing basis thereafter.