Obtain a payment system license in Seychelles

International payment service providers find this jurisdiction particularly appealing because of the government's active development of the industry, which focuses on digital services and remote business administration. Investors are encouraged to get a payment licence in Seychelles with the least amount of time and money due to the country's streamlined registration processes, transparent requirements for applicants, and lack of double taxation.

To meet the requirements imposed by the Central Bank, all applicants must show complete compliance with KYC and AML regulations. Seychelles' financial regulation has changed significantly throughout the years. At first, the nation was seen as an offshore area with little regulation. But in the last few decades, the focus of development has moved to support for digital services, transparency, and FATF compliance.

The legal landscape of fintech

If you want to get a licence to offer financial services in the Seychelles, you need to think about a lot of rules that control the payment solutions industry. The legal system is in line with international standards, which lets the jurisdiction compete successfully on the world stage. The National Payment System Act, 2022 is thought to be the most important rule book for this subject. It explains the legal status, requirements, and rules for all market participants. The Financial Institutions Act, 2004, and AML/CFT also apply. These rules spell out exactly what you need to do to get a payment permission in the Seychelles and what the licensing requirements are.

The Central Bank sends out a lot of by-laws, circulars, and recommendations to explain what local market participants need to do. The Guidelines for Licensing and Supervision of Payment Service Providers are one of them. They explain how to apply, what the application package should look like, how to choose the best applicants, and what the minimum operational standards are. Every applicant must read these required materials.

Seychelles has responsibilities to the rest of the world as a member of the global financial community. These responsibilities are set out by FATF, ESAAMLG, and other groups. This means that all rules and regulations for payment systems are made with the needs of the whole world in mind, such as the need for openness and safety in money matters. People who want to get a licence to offer financial services in Seychelles and do business with people from other countries must follow these rules.

Classification of payment systems

Emission payment systems are considered. These are companies that create and issue their own electronic money or other payment instruments, obligations for which they bear to clients. An example could be a platform with prepaid accounts replenished by users for further transactions. Such enterprises are obliged to keep clients' funds in segregated accounts, ensure transparency of operations and develop separate mechanisms for protection against the risk of loss of assets.

Businesses that use this model are typically focused on foreign markets. As part of the licensing procedure for processing payments in the Seychelles, they must go through more thorough due diligence. In addition, they must provide reports on a quarterly and annual basis, undergo audits, and continuously validate their risk management systems.

Non-issuing payment systems, on the other hand, serve as a bridge connecting the customer and banks or payment networks. They simply handle transfer and acceptance transactions on behalf of clients; they don't issue their own money. These could be processing platforms, aggregators, APIs, or payment gateways. These approaches have reduced startup costs and greater implementation flexibility. As a result, they are particularly well-liked by businesses that wish to begin operations with few obstacles and swiftly acquire a payment authorisation for financial services in Seychelles.

E-wallets and mobile payment apps are increasingly being used as a tool for routine B2C and B2B payments. These systems enable P2P transactions, bill payment, money management, and fund storage from a smartphone or other device. Businesses that offer these products must incorporate authentication, KYC identification, anti-crisis protocols, and a multi-level security system.

In order to create and operate an e-wallet, a company in the Seychelles must fully comply with all requirements for acquiring a payment licence. It is crucial to consider the processing time, which is contingent upon the applicant's preparedness and the accuracy of the material submitted. The complete process can take eight to sixteen weeks if you prepare properly. You can expedite the initial review and testing phases by having early communication with the Central Bank.

Requirements for a legal entity during the registration process

The enterprise's present legal and financial structure, development strategy, technical readiness, beneficiary history, and internal risk management system are all taken into account by the regulator. The speed and success of obtaining a licence to operate with payment systems in the Seychelles is strongly influenced by the calibre of the data supplied and the organisational structure.

The organization's place of registration is the first and most fundamental condition. Registering as an International Business Company is the most popular choice. However, a structure with a permanent representative office and an office in the country may also be used, depending on the business model.

Limited liability and a flexible corporate form are made possible by the IBC Act. However, a thorough company structure diagram must be submitted when requesting a payment licence in the Seychelles. It is beneficial to list all potential beneficiaries, reveal the ownership structure, and verify the stockholders' track record in the company.

A minimum paid-up authorised capital in the amount determined by the regulator must be present. The services' nature, target markets, anticipated operational volume, and degree of technological risk all play a role. Included in capital confirmation are:

• bank statement;
• auditor's report;
• financial model and business plan;
• break-even point calculation and cash flow analysis.

The funds must be placed on a segregated balance sheet in a financial institution licensed in the Seychelles or a partner jurisdiction. A mandatory rule is to confirm the sources of origin of the capital. This rule is especially important for those planning to obtain a license to operate payment systems in the Seychelles, as the islands strive to meet global transparency standards.

What documents will be needed for the procedure?

The total list of archives that will empower the supervisory specialists to assess the organization's money related soundness and lawful competence must be accumulated and composed earlier to record an application. Knowing what printed material is required to get a payment license in the Seychelles is a significant step in this strategy. A dismissal or extended delays in the application's thought may result from indeed a little flight from the prerequisites. The Central Bank, the company's controller, completely analyzes the company's inside association, proprietorship structure, authenticity, and capacity for dependability.

Providing the establishing archives validating the company's arrangement is to begin with. These comprise of the Certificate of Consolidation, the Articles of Affiliation and Reminder of Affiliation, and records confirming to the company's legitimate and physical address. A corporate determination of aim to begin the authorizing method is too included. It verifies the assignment of approved agents and the understanding of all trade parties to carry out this handle. The least required bundle for enrolling a permit to conduct monetary operations in the Seychelles incorporates all of these reports. The strategy cannot indeed start without them.

The another square incorporates archives that record the inner administration structure and control procedures:

Minutes of arrangement of chiefs, money related chief, chief compliance officer and MLRO (the individual dependable for compliance with anti-money washing arrangement) must be attached.

It is essential to uncover information on all shareholders and recipients, showing their offers. This permits the Central Bank to set up a chain of control and guarantee the straightforwardness of ownership.

The application bundle too incorporates a continuation of each supervisor, notarized duplicates of international ids, reports affirming private address, as well as letters of suggestion or certificates of proficient qualifications.

All of these reports serve as the establishment for the consequent issuance of a certificate permitting one to work with cash exchanges in Seychelles, especially when managing with computerized resources or abroad transfers.

The creation of monetary documentation gets uncommon consideration. A careful three-year trade arrangement that incorporates cash streams, hazard administration, scaling plans, sources of pay, and anticipated costs is required by the Central Bank. If the trade has as of now conducted operations, reports or documentation verifying the presence of stores must be given. The last mentioned is especially significant since any disappointment to confirm the source of reserves may be understood as a conceivable infringement of AML/CFT/KYC controls. Subsequently, without total and dependable budgetary straightforwardness, it is inconceivable to enroll a permit to perform cash administrations in Seychelles.

The application itself must be completed and submitted as the final step. This comprises receipts for authoritative charge installments, marked explanations confirming to the precision of the information provided, affirmations of no criminal record, and individual data. Besides, you might sometimes be inquired to give a lawful supposition from an adjacent attorney confirming the organization's compliance with all pertinent laws.

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Types of licenses for payment system upon receipt in Seychelles

Each of the two primary permit categories that the regulator offers has well-defined goals, legal requirements, financial obligations, and control systems. Since they guarantee the authenticity and legality of operations related to payments, e-wallets, and settlement processes, they are a necessary prerequisite for registration.

The Payment, Clearing, or Settlement System Operator License falls under the first category. It is designed for legal businesses, such as banks, fintech firms, payment agents, and international settlement platforms, that offer the operational and technological infrastructure required to enable the movement of funds between market players. Both centralised and decentralised processes, as well as real-time or deferred clearing settlements, can be supported by operators applying for a Seychelles payment system licence.

SCR 5 million (about USD 1.3 million) is the initial capital needed to file such an application, indicating significant financial stability requirements. The required yearly donation is SCR 100 thousand (about USD 26 thousand), and the application cost is SCR 50 thousand (approximately USD 13 thousand). Large companies that not only offer financial services but also constitute the framework of the nation's whole payment system are the main target of this type of licence. When applying for a certificate to handle financial transactions in the Seychelles, this is crucial. Businesses that deal directly with customers are eligible for the second category, which is the Payment Service Provider licence. Depending on the details of the services rendered, the permit itself is separated into two subcategories.

Services for money remittance make up the first subcategory. A minimum authorised capital of SCR 500,000, an application charge of SCR 20,000, and an annual fee of SCR 40,000 are required to obtain this kind of Seychelles payment licence. Organisations that handle P2P payments, cross-border financial transfers, or international money transfers should use this form.

E-wallets, mobile payments, e-money issuance, acquisition, electronic order processing, and other tools are all included in the second section, other payment services. The requirements for this form are more stringent. The application fee is SCR 25,000, the annual fee is SCR 50,000, and the beginning capital is SCR 1 million.

Businesses thinking about the requirements to get a licence to offer payment services in the Seychelles need to have a technical infrastructure and a ready-made business plan. Sustainability, legal purity, and preparedness for Central Bank monitoring must be proven. Following these guidelines enables you to conduct business in the jurisdiction lawfully and enhances the company's standing internationally.

Application process for license registration

Companies wishing to open a money services license in Seychelles must carefully consider all the requirements, deadlines and financial aspects of the process. The first step is strategic planning, which begins long before the official application is submitted. The organization must determine the exact type of permit that is needed. Next comes an analysis of the business model for compliance with legal requirements, including a study of the National Payment System Act, current regulations and instructions of the Central Bank. Already at this stage, the company must ensure that it meets the basic criteria:

• appropriate legal form;
• minimal capital investment;
• transparent ownership structure;
• the presence of risk management plans.

Each of them is a requirement for a Seychelles payment services licence, and any error could influence the outcome.

At the same time, the submission method is decided. A user-friendly interface for uploading documents, monitoring the status of consideration, and communicating with the regulator is offered by the Central Bank's web platform. For technical or legal reasons, not all applicants can use this format; in these situations, offline submission—by courier, legal agent, or postal service—is chosen. The procedure is the same in both situations, but it varies in terms of speed and ease of use.

The dossier is created in the second step. An application cannot be submitted without a well compiled package of supporting materials. The reputation of directors, the legal standing and transparency of shareholders, and the measures put in place to safeguard client funds are all given particular consideration by the regulator. Errors at this point could result in the application being rejected, among other costly consequences. Consequently, it is advised to work with legal companies or qualified consultants who have dealt with the Central Bank before.

Proof of payment for the processing fee must be sent with the application. Companies encounter their first significant financial obstacle at this point, thus it's critical to project the cost of acquiring a Seychelles payment licence in advance, taking into account all related expenses. The administrative review process starts after the application is filed. At this point, the Central Bank assesses the applicant's reputation overall, the claimed model's compliance with current legislation, the completeness of the dossier, and the accuracy of the data supplied.

CBS experts can interview appointed directors and compliance officers, submit requests for more information, and ask for proof of the dependability of banking partners. If the beneficiaries are registered outside of the nation, foreign regulators may occasionally be contacted. The speed at which a payment authorisation can be issued in the Seychelles is determined by this crucial step.

The applicant is formally notified of the licence assignment upon a favourable decision. After that, the business needs to activate the operating accounts and pay the first yearly licence charge. The payment platform's technical configuration must then be finished, and the formal announcement of the launch of operations must be made. The business can then start operating fully within the parameters of Seychelles law.

Requirements for the qualifications of managers

The applicant business and everyone with the authority to oversee and administer the payment system's operations are thoroughly examined by the regulator. This is explained by the necessity of adhering to global norms of openness and business ethics, as well as the significance of avoiding the hazards connected to fraud and illicit money turnover. Businesses must make sure their top managers fulfil these requirements before applying for a licence to use Seychelles payment systems.

Higher education is a prerequisite for those applying for executive director, chief compliance officer, financial director, and other management decision-making roles. It is better if it has to do with accounting, management, law, finance, or IT. International certifications such as ACAMS, ICA, CPA, and ACCA are accepted and can greatly improve the application's chances of being accepted. Formal schooling is insufficient, though.

It is necessary to exhibit at least three to five years of experience in comparable roles within the financial or fintech industry in order to successfully register a payment licence for international operations in Seychelles. CVs for candidates should show:

• a sustainable career trajectory;
• participation in risk management;
• implementation of compliance strategies;
• interaction with regulators;
• management of client funds.

Experience is confirmed by recommendations from previous places of work, scans of employment contracts, profiles on networks (for example, LinkedIn), copies of certificates and diplomas. The regulator requires that the data provided be reliable and correspond to the real contribution of the manager to the development of previous projects.

An equally important criterion is an impeccable business reputation. The Central Bank requires that the executives listed in the license have no criminal record, especially for articles related to fraud, financial crimes, corporate abuse or violation of AML/CFT regulations. Providing a certificate of no criminal record is a mandatory document. Moreover, it must be issued by the competent authorities of the candidate’s country of citizenship or long-term residence. Moreover, regulatory authorities may send international requests to the databases of Interpol, FATF and other structures to issue a payment license in the Seychelles.

Technical conditions for the payment system

According to current regulatory norms, any business requesting authorisation to operate in the financial sector must have a high degree of readiness across the board. This is required to safeguard consumer interests, stop fraud, and guarantee the steady operation of payment systems. Technically speaking, regulators consider infrastructure, software, data security measures, and IT audits when determining whether to grant a payment licence in the Seychelles.

The candidate must submit thorough documentation attesting to the existence of a dependable and expandable infrastructure. The foundation is server capacity, which can be virtual, offered by cloud providers that adhere to all security regulations, or physical, housed in approved data centres. To guarantee fault tolerance and high system availability, it is crucial to duplicate all essential parts, including servers, data storage systems, and communication links.

Simultaneously, Seychelles regulators focus on ensuring that data centres meet international safety and quality standards, such as Tier III and above accreditation. Having a representative office or technical presence on the islands' territory is frequently necessary. For businesses looking to get a licence to provide payment services in the Seychelles, this is a crucial requirement.

The network architecture, load distribution, and connection diagrams to internal and external systems must all be covered in a thorough technical plan. The regulator's trust is greatly increased by all of this evidence, which shows that the business can professionally manage its infrastructure. The software that controls the payment system is essential to the evaluation process. The business must show that the solutions it uses adhere to stringent efficiency and security standards.

Taxation and accounting for payment systems in Seychelles

A progressive corporate tax is the foundation of the system. Everyone who intends to apply for a Seychelles payment licence ought to consider it. Profits over one million SCR are subject to a 25% tax rate, whereas profits under this threshold are subject to a 15% tax rate (about $75,000 USD).

Young and developing businesses benefit greatly from this approach since it lowers the tax burden during the early stages of their operations, which encourages new investments and innovations in the nation's financial sector. It should be kept in mind that a company may be recognised as a tax resident and, as a result, be subject to general taxes even if it does not have a formal presence in the Seychelles but is actually run from its territory.

The islands have a withholding tax system that encompasses a number of different payment types and is applicable to payments made to non-residents. Those who plan to apply for a permit to operate with payment systems in the Seychelles should consider this. Specifically, interest is taxed at 15%, dividends are currently taxed at 0%, and royalties are taxed at 15%.

Depending on the terms and form of the agreement, management fee payments can range from 10% to 33%. In order to prevent fines and disputes with authorities, payment companies that make payments overseas must keep a careful eye on the correct withholding of taxes and the fulfilment of responsibilities.

In Seychelles, getting a payment system licence entails extra required costs despite tax advantages. Annual fees, in instance, can range from $3,000 to $25,000 USD and beyond, depending on the type and category of permit. Maintaining openness of operations and adherence to regulatory requirements through the audit process is essential for fostering trust among partners, clients, and regulators.

Responsibility for violation in registration of payment license in Seychelles

Legal liability covers a wide range of consequences, from administrative measures to criminal liability. It is important to understand that the regulator strictly controls compliance with the legislation and regulations governing the activities of payment systems, so any deviation from the established rules can entail serious consequences that negatively affect the reputation, financial position and the possibility of further work of the company in the market. In order to minimize risks and ensure stable operations, it is extremely important for enterprises not only to formally register permission to process payments in the Seychelles, but to scrupulously comply with all the rules.

Administrative liability is the first level of impact on violators. It includes the imposition of significant fines, which can vary significantly depending on the nature and scale of the violation. In addition to financial sanctions, the regulator has the right to apply other measures:

• suspension of the license;
• restrictions on certain types of activities;
• requirements to eliminate violations within strictly established timeframes;
• Initiation of the procedure for revocation of permission

In this context, it is extremely important for organizations to promptly register a payment system license in Seychelles and ensure ongoing compliance with the regulator's requirements. Failure to comply with these conditions leads to sanctions and significantly reduces the trust of customers and partners, which can have long-term negative consequences for the business.

In the event of proven guilt, the company and its managers may be required to compensate for the losses incurred. Such disputes often arise due to non-compliance with contractual obligations, incorrect payment processing, and violation of security and confidentiality rules for customer data. To minimize the likelihood of such situations, it is recommended to implement comprehensive internal control mechanisms.

Risks and measures to minimize them

For organizations seeking to obtain a payment system license in Seychelles, understanding and competently managing potential threats is a must. Without it, it is impossible to build a reliable, competitive and secure payment infrastructure. In this context, special attention is paid to a comprehensive assessment and systematic mitigation of operational, financial and cyber risks. This ultimately allows the company to comply with the regulator's conditions and build effective internal processes that ensure the protection of the interests of participants.

It is necessary to take care of the creation of an effective control and audit system that allows for the timely identification and elimination of shortcomings. For enterprises that want to promptly obtain a payment system permit in the Seychelles, the implementation of such mechanisms is defined as the most important tool for reducing operational risks and strengthening trust on the part of the regulator and clients.

Financial threats are no less important in the management system. They are associated with potential losses caused by market fluctuations, insufficient capital, unforeseen expenses and liquidity risks. For payment systems operating in the international space, it is especially critical to ensure financial stability and the availability of sufficient reserves to cover potential losses. The Seychelles regulatory authorities impose clear requirements for the size of the authorized capital and reporting. This helps reduce the likelihood of crises within the company.

Entrepreneurs who are busy registering a payment system license in Seychelles must take cyber risks into account. They represent one of the most significant problems in the modern digital world. With the increase in the volume of online transactions and the development of technology, the need to protect information systems from hacking, fraud and data leakage has increased dramatically. The development and implementation of effective cybersecurity protocols can minimize the risks of failures and attacks, but increase the trust of customers and partners in the payment system.

Procedure for suspension and revocation of a license

Even if a company has successfully obtained a payment system permit in the Seychelles, the regulator retains the power to revoke it at any time. The grounds for such actions may be numerous factors - from violations of financial monitoring and reporting standards to insufficient capitalization. If the company does not take timely measures to eliminate violations, the regulator initiates the procedure for suspending the license.

Regulators check not only the legal status of the company, but also its operational stability, fulfillment of obligations to clients, the presence of a full-fledged internal control structure and compliance with corporate governance procedures. If any of these points are not met, the license may become invalid for a period of 30 days to several months, during which the company is obliged to provide evidence of correction of the situation.

Organizations that want to quickly obtain a payment permit in Seychelles should take into account that even a minor deviation from the requirements of the law can entail serious consequences. The decision can be appealed administratively and through the courts, while the period for filing an appeal and the procedure for its consideration are clearly regulated. For a successful outcome, it is necessary to convincingly prove the absence of violations or provide evidence of the elimination of all identified deficiencies.

Revocation of a payment system license in Seychelles is an extreme measure that the regulator takes if a firm has consistently violated regulatory requirements or poses a threat to users of the services. This may include operating without sufficient reserve funds, improper storage of customer data, manipulation of financial statements, etc. Once revocation occurs, the business loses the right to provide any payment services. The activity is subject to immediate cessation, and all existing contracts may be terminated.

The law allows for the possibility of re-licensing if the organization proves its readiness to comply with all requirements. To do this, it is necessary to re-collect the entire package of documents, undergo an internal audit, confirm the business reputation of the management, and in some cases, reorganize the corporate structure. The regulator takes into account the company's past history and the measures taken to eliminate risks.

Legal consequences of non-compliance

Once a company decides to register a payment system permit in Seychelles, it comes under strict control. At the administrative level, sanctions often begin with fines for:

• late submission of reports;
• insufficient compliance procedures;
• lack of internal documentation;
• violations of requirements for the protection of client funds;
• lack of a reasonable plan to address the issues;
• failure to comply with the order to implement backup mechanisms for protecting users' funds.

In case of systematic ignoring of the requirements of the regulatory authorities for obtaining a payment license in Seychelles, the company may be suspended in all its transactions until the discrepancies are eliminated. Moreover, these actions may entail fines that range from 100 thousand to 1 million SCR (≈ 6.9 thousand - 69 thousand USD) and the publication of information about the violator on the official websites of the regulators.

Civil liability is another important aspect that accompanies the registration of a license for money transactions in Seychelles. If, as a result of violations of the terms and conditions or negligence, damages are caused to clients, users or third parties, the company is obliged to compensate for the damage in full. For example, in the case of a leak of client data due to a non-working encryption system or a failure in the execution of transactions with delays in settlements, users have the right to file a class action or individual lawsuit. The court can award significant compensation, especially if there are systemic violations.

Criminal liability is applied in the presence of malicious intent or serious consequences of violations. This is especially true for cases of illegal circulation of funds, financing of criminal activity, working with sanctioned jurisdictions, using shell companies, falsifying reports, etc. Then the regulator initiates an investigation not only at the Seychelles level, but also within the framework of international cooperation. The lack of an adequate response or untimely elimination of deficiencies automatically leads to the forced revocation of the payment system permit in the Seychelles.

Conclusion

In the Seychelles, obtaining a licence for a payment system is a complicated legal and operational process that involves hundreds of different activities. A complicated process of planning, risk assessment, internal legal adaption, and direct communication with authorities must be followed by the business. Gathering a comprehensive packet of documentation is one of the applicant's most crucial responsibilities. Moreover, an AML policy must be created, technical requirements must be met, an IT system audit must be prepared, etc.

To prevent underfunding the project, a business must anticipate all present and future costs in addition to the process itself. The type of permit, necessary start-up capital, application price, audit fees, compliance, IT infrastructure, etc. all affect how much it costs to get a payment licence in the Seychelles. Effective financial modelling and strategic planning are necessary for all of the aforementioned.

In this sense, the choice to apply for a licence to offer financial services in the Seychelles necessitates the participation of seasoned professionals who are conversant with local legislation. From initial consultation and business model research to complete material preparation, legal representation before the Financial Services Authority, and assistance throughout the post-licensing control phase, our consulting firm provides customers with all-encompassing support. We have worked on projects involving digital wallets, payment systems, and e-commerce for many years. Our professionals will reduce risks, expedite the registration process, and steer clear of common blunders.