EMI versus payment institution: what's the difference?
A plain-language comparison of e-money institutions and payment institutions, and how the distinction affects what you can build.
Founders often ask whether they need an e-money institution (EMI) or a payment institution (PI) authorisation — or whether they can rely on a partner instead. The distinction matters because it shapes what your product can do.
The broad distinction
A payment institution is generally authorised to provide payment services — moving money on behalf of customers. An e-money institution can, in addition, issue electronic money: storing value that customers can hold and spend later.
If your product holds customer balances (wallets, stored value), that typically points toward e-money. If you primarily initiate or process payments without holding stored value, a payment-services scope may be sufficient.
The partner route
Many teams launch by relying on a licensed partner’s permissions rather than holding their own authorisation. This can be faster, but it changes your obligations and commercial terms, and the regulated activity still sits with the partner.
Things to clarify early
- Does your product hold stored value, or only move funds?
- Which activities require your own authorisation versus a partner’s?
- What safeguarding model applies to customer funds?
A note on scope
The exact definitions, permissions and thresholds are set by regulators and differ by jurisdiction. This article is general information, not legal or regulatory advice — take specialist advice for your specific model.