--- title: "EMI vs PSP vs VASP vs CASP: Which Financial Licence Do You Need?" slug: emi-psp-vasp-licence-comparison publishedAt: 2026-04-18T09:00:00Z author: Finconduit Editorial Team tags: MiCA, PSD2, EMD2, FATF canonicalUrl: https://finconduit.com/resources/emi-psp-vasp-licence-comparison --- # EMI vs PSP vs VASP vs CASP: Which Financial Licence Do You Need? A comparison of EMI, PSP, VASP, CASP, MSB (Canada) and MSO (Singapore/HK) licences — what each permits, barriers of entry, capital requirements, and which structure suits your business. Founders building cross\-border financial products in the EEA repeatedly conflate four very different regulated activities — payment services, electronic money issuance, crypto\-asset services, and the legacy **VASP** perimeter. The licences look interchangeable on a slide. They are not. Each authorises a specific set of activities under a different regulator's perimeter, with different capital, different ongoing cost, and different commercial leverage. Picking the wrong one wastes **12–24 months** and burns the founding capital that should have been spent on product. **EMI** authorises issuing electronic money and the payment services that come with it. **PI** authorises payment services without e\-money issuance. **VASP** was the pre\-**MiCA** national registration regime for crypto exchange and custody — sunsetting in most member states between **1 July 2026** and 30 December 2026. **CASP** is the **MiCA** authorisation that replaces it across all 30 EEA member states. This guide explains what each licence actually authorises, the capital and timeline differences, when combined licences \(**EMI** \+ **CASP**, **PI** \+ **CASP**\) are the right architecture, and the decision tree for picking the right one for your business model. Read this before you brief the lawyers. ## What Each Licence Actually Authorises The four licences cover four different regulatory perimeters. They overlap at the edges, but the centre of each is materially distinct. Map your product to the centre, not the edge. *Table: Core regulated activity for each licence type.* | Licence | Regulatory framework | Core activity | Cannot do without an additional licence | | --- | --- | --- | --- | | EMI | Electronic Money Directive \(EMD2\) | Issue electronic money \+ provide payment services on the e\-money | Lend; hold customer crypto\-assets; provide investment services | | PI / MPI | Payment Services Directive \(PSD2\) | Provide payment services — execution of transactions, transfers, card processing, FX, AISP/PISP | Issue e\-money; hold balances longer than payment\-execution window | | VASP | 5AMLD national transposition \(sunsetting\) | Crypto exchange and custodial wallet services, on a national registration basis | Passport across the EEA; serve EEA customers from 2026 onward without MiCA conversion | | CASP | Markets in Crypto\-Assets Regulation \(MiCA\) | Eight crypto\-asset services across the EEA — exchange, custody, trading platform, execution, advice, portfolio management, transfer, placement | Issue fiat e\-money; provide pure payment services on fiat without an EMI/PI authorisation | ## **EMI** — **Electronic Money Institution** An **Electronic Money Institution** is authorised to issue electronic money — pre\-funded balances stored on a card, in a wallet, or against an **IBAN** — and to provide the payment services attached to those balances. The [Electronic Money Directive](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32009L0110) sets the prudential perimeter; the [Payment Services Directive](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32015L2366) fills in the operational obligations. **Stripe**, **Wise**, and **Revolut** all started life as **EMI**s.¹[^1]²[^2] Initial capital is **€350,000**. Ongoing **own funds** is the higher of the **initial capital** floor or method\-A/B/C calculated against e\-money outstanding \(typically 2% of average e\-money outstanding\). Client funds are safeguarded by segregation in a credit institution or by an insurance policy of equivalent credit quality. Client funds safeguarding is the operational test that **NCA**s inspect most frequently — a failure here is the **fastest** path to a supervisory letter. **EMI**s can also provide every **PI** service. That is why **EMI** is the default choice for fintechs that combine e\-money issuance with cards, transfers, **FX**, and **IBAN** issuance. The **EMI licence** **passport**s across the EEA on the same notification mechanism as the **PI licence**. ## **PI** / **MPI** — **Payment Institution** A **Payment Institution** provides payment services without issuing e\-money. The **Payment Services Directive** lists eight regulated payment services: cash deposits, cash withdrawals, transaction execution \(covered/uncovered\), card issuing, acquiring, money remittance, **AISP**, and **PISP**. A **PI** authorisation is scoped to one or more of these services; the capital floor depends on the scope. *Table: PI initial capital by activity scope \(PSD2 Article 7\).* | Scope | Initial capital | Examples | | --- | --- | --- | | Money remittance only | €20,000 | Cross\-border consumer remittance; fiat\-only | | Payment initiation services \(PIS\) | €50,000 | Open\-banking PISP\-only firms | | All other payment services \(no e\-money\) | €125,000 | Acquiring, card processing, transaction execution, FX | | Account Information Services only \(AIS\) | €0 \(no capital, registration only\) | Pure AISP — read\-only account aggregators | **PI** is the right choice when you do not need to hold customer balances overnight. As soon as you do — gift card balances, prepaid wallet balances, stored\-value accounts — the e\-money definition is triggered and you need an **EMI licence** instead. **NCA**s scrutinise the boundary between **PI** and **EMI** carefully; running **EMI** activity under a **PI licence** is an enforcement event. ## **VASP** — **Virtual Asset Service Provider** \(Sunsetting\) **VASP** is the pre\-**MiCA** national registration regime introduced by the [Fifth Anti\-Money Laundering Directive](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32018L0843) in 2018, requiring crypto\-asset exchanges and custodial wallet providers to register with their national **AML** authority. Each member state implemented this differently — **Estonia** and **Lithuania** built quick\-onboarding regimes; **Germany** and Netherlands built rigorous ones. The result was 27 different national **VASP** regimes with no mutual recognition.⁴[^3] Under **MiCA**, the **VASP** perimeter is being absorbed into the **CASP** regime. Member states activated **transitional period**s of up to 18 months from **MiCA**'s full application on **30 December 2024**. After expiry — most ending between **1 July 2026** and 30 December 2026 — every legacy **VASP** must hold a **MiCA CASP** authorisation to continue operating in the EEA. > **Warning:** If you are operating today on a VASP registration alone, the clock is running. Conversion to a MiCA CASP authorisation is not automatic — you must submit a full CASP file, evidence governance and capital, and pass the same authorisation review as a new applicant. Build the conversion timeline now: 9–18 months end\-to\-end including pre\-application work. ## **CASP** — **Crypto\-Asset Service Provider** Under **MiCA** A **Crypto\-Asset Service Provider** authorisation under the [Markets in Crypto\-Assets Regulation](https://eur-lex.europa.eu/eli/reg/2023/1114/oj) **passport**s across all 30 EEA member states from a single **NCA** grant. The licence covers eight regulated services across three classes \(Annex IV\), with **prudential capital** scaling with class: **€50,000** for Class 1 \(advisory/marketing\), **€125,000** for Class 2 \(execution/exchange/transfer\), and **€150,000** for Class 3 \(custody, operating a trading platform\).⁵[^4] On top of the class floor, **CASP**s must satisfy the **fixed overhead requirement** \(25% of prior year's fixed overheads\) and operate under the [EBA Guidelines](https://www.eba.europa.eu/) for ML/TF risk, the [Transfer of Funds Regulation](https://eur-lex.europa.eu/eli/reg/2023/1113/oj) **Travel Rule**, and the [Digital Operational Resilience Act](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32022R2554) **ICT** framework. [AMLR](https://eur-lex.europa.eu/eli/reg/2024/1624/oj) will overlay a single EU **AML** rulebook from 10 July 2027.⁶[^5]⁷[^6]⁸[^7]⁹[^8] ## Side\-by\-Side Comparison The table below compares the four licences across the dimensions that drive the decision: regulatory framework, scope, capital, regulator, **passport**, timeline, and ongoing cost. *Table: EMI vs PI vs VASP vs CASP — comparison across the dimensions that drive the licence decision.* | Dimension | EMI | PI / MPI | VASP \(legacy\) | CASP \(MiCA\) | | --- | --- | --- | --- | --- | | Regulatory framework | EMD2 \+ PSD2 | PSD2 | 5AMLD national transposition | Markets in Crypto\-Assets Regulation | | Core activity | Issue e\-money \+ provide payment services | Provide payment services only | Crypto exchange \+ custodial wallets \(national\) | Eight crypto\-asset services across EEA | | Initial capital | €350,000 | €20,000–€125,000 \(scope\-dependent\) | €0–€125,000 \(NCA\-dependent\) | €50,000 / €125,000 / €150,000 \(class\-dependent\) | | Ongoing capital | Higher of floor or 2% of e\-money outstanding | Method A/B/C of activity volume | National variation; minimal | Higher of class floor or 25% fixed overheads | | EEA passport | Yes — full passporting | Yes — full passporting | No — national registration only | Yes — full passporting | | Typical timeline | 9–18 months | 6–12 months | 1–6 months historically; closing | 6–12 months \(LT\) to 12–24 months \(DE\) | | AML perimeter | Full obliged entity under EBA Guidelines | Full obliged entity under EBA Guidelines | Obliged entity under 5AMLD national law | Full obliged entity under AMLR / EBA Guidelines | | Annual ongoing cost \(mid\-sized\) | €500,000–€1.2M | €300,000–€800,000 | €100,000–€400,000 \(sunsetting\) | €400,000–€900,000 | | Status in 2026\+ | Stable; PSD3 / PSR pending | Stable; PSD3 / PSR pending | Sunsetting — convert to CASP | Stable; AMLR overlay 2027 | ## Which Licence Do You Actually Need? Pick the licence that matches the regulated activity at the centre of your business model — not the activity at the edge. *Table: Decision tree by business model — which licence\(s\) you need.* | Business model | Primary licence | Combined with | | --- | --- | --- | | Crypto exchange / custodian / trading platform serving EEA customers | CASP \(Class 3\) | EMI if you also issue fiat IBANs to clients; otherwise EMI is optional | | Stablecoin issuer \(EMT or ART\) | MiCA EMT or ART issuer authorisation | CASP if you also operate a trading venue; EMI if EMT\-equivalent activity | | Cross\-border consumer remittance, fiat\-only | PI \(money remittance scope\) | n/a | | Open\-banking AISP / PISP \(read\-only or initiation\) | PI \(AIS / PIS scope\) | n/a | | Card issuing or acquiring with stored balances \(prepaid\) | EMI | PI is insufficient — stored balances trigger e\-money | | Card acquiring without stored balances | PI \(acquiring scope\) | n/a | | Crypto\-on\-ramp \+ fiat IBAN issuance to clients \(typical retail crypto wallet\) | EMI \+ CASP | Lithuania is the dominant jurisdiction for the EMI \+ CASP combo | | Pure crypto custody for institutional clients | CASP \(Class 3\) | n/a | | Investment services on traditional securities \+ crypto | MiFID II CIF \+ MiCA CASP | Cyprus or Ireland — CySEC / Central Bank of Ireland dual authorisation | | Pre\-MiCA VASP holding national registration only, EEA\-active | Convert to CASP before transitional period expires | EMI if combining with fiat IBAN issuance | > **Tip:** The most powerful combination for a 2026 retail crypto fintech is EMI \+ CASP from a single NCA. Bank of Lithuania authorises both under one supervisory team, the application files share a Programme of Operations and AML programme, and the resulting entity passport\-issues fiat IBANs and offers crypto exchange and custody from a single regulatory perimeter. Apply in parallel — never sequentially. ## Costs Across All Four Licences Annual regulatory operating cost varies by 5–10× across these licences. The drivers are: **prudential capital** \(held but not deployable\), ongoing supervisory fees, audit, **MLRO** and compliance headcount, and supplier stack \(**Travel Rule**, **blockchain analytics** for crypto licences; transaction monitoring, sanctions screening for all\). The single biggest variable is whether the licence requires a crypto supplier stack. **Travel Rule**, **blockchain analytics** and crypto\-aware transaction monitoring add €120,000–€360,000/year to a **CASP** — costs that simply do not exist for an **EMI** or **PI** not operating in crypto. Build the cost forecast around the supplier stack first, then add the regulatory headcount on top. ## Where the Regime Is Going — [PSD3](https://finance.ec.europa.eu/regulation-and-supervision/financial-services-legislation/implementing-and-delegated-acts/payment-services-directive_en), **PSR**, and **AMLR**³[^9] The European Commission proposed **PSD3** and the Payment Services Regulation \(**PSR**\) in June 2023. The proposals merge **EMD2** into the payment services framework, raise the **AISP**/**PISP** technical standards, and give the **EBA** expanded supervisory tools. Adoption is expected in 2025–2026 with application from 2027–2028. **EMI**s and **PI**s should expect: a unified payment services authorisation replacing the **EMI**/**PI** split, stronger **client funds safeguarding** requirements, and stricter outsourcing rules aligned with **DORA**. On the **AML** side, **AMLR** overlays a single EU rulebook on every **CASP**, **EMI** and **PI** from 10 July 2027 — replacing the patchwork of 27 national **AML** laws. Direct supervision by **AMLA** covers \~40 **highest**\-risk obliged entities; the rest stay under their home **NCA** but apply the **AMLR** substantive rules. ## Frequently Asked Questions ### Can a single entity hold both an **EMI licence** and a **CASP authorisation**? Yes — and this is the common architecture for retail crypto fintechs in 2026. A single legal entity can hold an **EMI licence** under **EMD2** and a **CASP authorisation** under **MiCA**, both from the same **NCA**. The **Bank of Lithuania** has authorised this combination repeatedly. The two authorisations share governance, **ICT**, and **AML** infrastructure but maintain separate **prudential capital** and segregated client **safeguarding account**s \(one for e\-money holders, one for crypto custody clients\). ### Is a **VASP registration** enough to serve EEA customers in 2026? Only inside the **transitional period** and only in member states that opted into the maximum 18\-month **grandfathering** window. The **transitional period** ends between **1 July 2026** and 30 December 2026 across member states. After expiry every **CASP**\-perimeter activity requires a **MiCA CASP** authorisation — **VASP registration**s do not auto\-convert. Several member states \(**Germany**, Netherlands\) opted for shorter windows. Plan a 9–18 month conversion programme starting now. ### Do I need an **EMI licence** to issue stablecoins? No — under **MiCA**, stablecoins are split into **asset\-referenced token**s \(**ART**\) and **e\-money token**s \(**EMT**\), each with its own **MiCA** authorisation regime. **EMT** issuers must be authorised as either an **EMI** under **EMD2** or as a credit institution under CRD, plus separately notify the **EMT** under **MiCA**. **ART** issuers go through the **MiCA** **ART** authorisation directly. **EMI** is the simpler path for a single\-currency fiat\-pegged token. ### What's the cheapest licence to get? By **initial capital** alone: **PI** \(AIS\-only\) at €0, **PI** \(money remittance\) at **€20,000**, **PI** \(**PI**S\) at **€50,000**, **CASP** Class 1 at **€50,000**, then **PI** \(general\) and **CASP** Class 2 both at **€125,000**, **CASP** Class 3 at **€150,000**, and **EMI** at **€350,000**. By total programme cost \(legal, supervisory, supplier stack, headcount\), **CASP** is the most expensive non\-bank licence because of the crypto supplier stack. **EMI** is cheaper than **CASP** unless you also need crypto activity. ### Which **jurisdiction** is **fastest** for an **EMI** authorisation? **Bank of Lithuania** has historically been the **fastest** serious **EMI** regulator in the EEA at **6–12 months**, followed by **MFSA** **Malta** and **CySEC** **Cyprus**. **Central Bank of Ireland** and **BaFin** are 12–18 and **12–24 months** respectively. Speed correlates inversely with institutional credibility — the rigour of **BaFin**'s review is the credibility you buy when you choose **Germany**. ### Does **PSD3** mean I should wait to apply for an **EMI**? No. **PSD3** / **PSR** adoption is expected in 2025–2026 with application from 2027–2028. Existing **EMI** and **PI** authorisations will be grandfathered and converted to the new framework — there is no advantage to waiting, and the lost 18 months of operating capital outweighs any drafting risk. Apply now under the current regime; conversion will be administered by the **NCA** when **PSD3** takes effect. > **Call to action:** Picking between EMI, PI, VASP and CASP for a specific business model? Finconduit connects regulated fintech founders with vetted EMI / PI / CASP counsel and helps scope the right licence \(or combination\) for your product, customer base and target jurisdictions. Get a free licence\-fit assessment. ## Related Guides - [MiCA Compliance Guide for CASPs](/resources/mica-compliance-guide-casps): Authorisation walkthrough — capital, governance, supplier stack - [EEA vs UK vs Offshore: Where to Incorporate Your Crypto Business](/resources/eea-uk-offshore-crypto-incorporation): Which **jurisdiction** maximises regulatory access and tax efficiency - [How to Get a Bank Account for a VASP or CASP](/resources/bank-account-vasp-casp): The 2026 banking playbook for regulated crypto firms - [AML Compliance for Crypto Firms](/resources/aml-compliance-crypto-6amld): What the **6AMLD** requires from **CASP**s and **VASP**s Picking between **EMI**, **PI**, **VASP** and **CASP** is not a vocabulary exercise — it is a multi\-million\-euro architectural decision that locks in supervisor, capital, timeline, and customer base for the next decade. The fintechs that get this right combine licences deliberately \(**EMI** \+ **CASP** for retail crypto, **PI** \+ **CASP** for institutional, MiFID II CIF \+ **CASP** for structured products\) and pick a single **NCA** that authorises both ends of the combination. Get the licence right before you build the product. - [PSD3 / PSR Adoption Track: From COREPER to Official Journal \(May 2026\)](/resources/psd3-psr-adoption-track-2026) — where PSD3 and the PSR sit on the EU adoption track and what changes for PSP licence\-holders. - [The Anatomy of a Successful EMI Authorisation](/resources/anatomy-successful-emi-authorisation) — the EMI file walkthrough that complements this comparison. - [PSD2 vs MiCA: The Decision Matrix Every Regulated Fintech Needs in 2026](/resources/psd2-vs-mica-decision-matrix) — the six\-dimension test that names the right regime before licensing begins. - [Tokenized Real\-World Assets and Security Tokens](/resources/tokenized-rwa-security-tokens-mica-mifid) — where security tokens fall under MiFID rather than MiCA, and what licence that implies versus a CASP/EMI. ## Footnotes [^1]: Directive 2009/110/EC on the taking up, pursuit and prudential supervision of the business of electronic money institutions \(EMD2\). [^2]: Directive \(EU\) 2015/2366 on payment services in the internal market \(PSD2\). [^3]: Directive \(EU\) 2018/843 \(Fifth Anti\-Money Laundering Directive — 5AMLD\), brought crypto\-asset exchange and custodial wallet services into AML scope as obliged entities. [^4]: Regulation \(EU\) 2023/1114 \(Markets in Crypto\-Assets Regulation — MiCA\), OJ L 150, 9.6.2023. [^5]: Regulation \(EU\) 2023/1113 on information accompanying transfers of funds and certain crypto\-assets \(Transfer of Funds Regulation\), applicable from 30 December 2024. [^6]: EBA Guidelines on the management of money laundering and terrorist financing risks \(EBA/GL/2021/02\). [^7]: Regulation \(EU\) 2024/1624 \(AML Regulation — AMLR\), part of the EU AML Package, applicable from 10 July 2027. [^8]: Regulation \(EU\) 2022/2554 \(DORA\) on digital operational resilience for the financial sector. [^9]: Proposal for a Directive on payment services and electronic money services in the internal market \(PSD3\) and proposal for a Regulation on payment services \(PSR\), 28 June 2023 — to replace PSD2 and EMD2. --- Source: https://finconduit.com/resources/emi-psp-vasp-licence-comparison