The Small Payment Institution [Polish: MIP] is a solution addressed to entrepreneurs who provide payment services within the scope of their business activity. It corresponds to all the activities that are necessary to maintain an account, such as depositing or withdrawing money, transferring funds or operating money orders. In the case of Small Payment Institution, the average monthly amount of such transactions cannot exceed 1 500 000 EUR per year.
What is a Small Payment Institution in Poland [Polish MIP]?
According to the statutory explanation, the Small Payment Institution may be defined as an entity – a natural person, legal person or an organizational unit that is not a legal person but to which the Act grants a legal capacity – that obtained an entry in the register of payment and electronic money institutions and conducts a business activity that provides any of the payment services other than initiating payment orders or accessing account information.
Who can register a Small Payment Institution?
A Small Payment Institution may be registered by a natural person, legal person (in such case we advise you to form a company in Poland) or an organizational unit that is not a legal person but to which the Act grants a legal capacity. A person managing the Small Paying Institution may not be legally convicted for a crime against the administration of justice, for an economic crime or fiscal offence.
To operate in the form of a Small Payment Institution, an entrepreneur must first obtain an entry in the register of payment and electronic money institutions. It stems from the fact that the activity in the field of payment services constitutes a regulated activity according to the provisions of the Act on the Entrepreneurs’ Law. The register is kept by the Financial Supervision Authority [Polish: KNF]. The entry is made at the request of the entrepreneur who intends to operate as the Small Payment Institution.
What should be enclosed in the application for a Small Payment Institution’s registration?
The application for registration of a Small Paying Institution shall be submitted on the official form available on the website of the Polish Financial Supervision Authority. It shall include:
- a list of payment services that the entrepreneur intends to provide,
- information about the applicant – name and surname or the company’s name, address of the place of residence or registered office and address of the main place of conducting a business activity, Tax Identification Number [Polish NIP] and, if an entrepreneur is registered in National Court Register [Polish: KRS], he or she should also submit the KRS number.
If the applicant intends to conduct business activity with the support of agents, he or she needs to submit a relevant statement to the competent authority on the official form. It is available on the website of the Financial Supervision Authority [Polish: KNF]. If the business is going to be run by the company’s branches, the applying entrepreneur should also provide their names and addresses.
Attachments to the application for registration of a Small Payment Institution
It is very important to attach all the necessary documents while applying for a registration of a Small Payment Institution. This will allow for an efficient and quick registration without the need to correct formal deficiencies.
The first of the attachments constitutes a graphic diagram presenting the payment services that the entrepreneur intends to provide as a Small Payment Institution. The graphic diagram shall include a description of the services. The entrepreneur should also indicate what the type of the offered payment service is, as specified in the Act, and which entities will participate in the process of providing them. The diagram should show how resources and information will flow in the process of providing the services. It is important to prepare the diagram with respect to the statutory deadlines as indicated in the Act on Payment Services.
Moreover, the entrepreneur has to enclose a statement that the data included in the application are complete and true. The applicant should also confirm that he or she knows the statutory conditions for conducting business activity as a Small Payment Institution and that he or she meets the requirements.
The application is subject to a fee of 616 PLN payable to the account of the taxpayer service center of the Municipal Office of Warsaw Capital City. Payment confirmation should be attached to the application.
The application should be signed by the applicant or by his or her representative. In the case of acting through the representative, the application shall be accompanied by a relevant document of authorization. This obligation does not concern applicants who are registered in the Central Registration And Information On Business [Polish: CEIDG] and who act through their representative designated in the Register.
The Small Payment Institution must keep the documents necessary to prove the fulfilment of the conditions required to perform the activity for a period of at least 5 years from the day of their creation or receiving.
How to submit an application for registration of a Small Payment Institution?
A correctly completed and paid application for registration of a Small Payment Institution can be submitted both electronically and in a traditional way.
If the applicant wants to deal with this matter online, he or she may use the Electronic Platform of Public Administration Services [Polish: ePUAP] via the Inbox of the Financial Supervision Authority Office.
However, the application for registration of a Small Payment Institution may also be sent by a traditional mail to the address of the Polish Financial Supervision Authority. It is also possible to submit the application personally to the office of the Polish Financial Supervision Authority in Warsaw.
Processing of the application for registration of a Small Payment Institution
Financial Supervision Authority [Polish: KNF] may refuse the registration if the application is incomplete and is not corrected within the specified time period. Moreover, the refusal will take place if the data included in the application are inconsistent with the facts.
The Financial Supervision Authority will refuse the registration obligatorily in the following cases:
- if the entrepreneur has been subject to a legally binding decision prohibiting him or her from engaging in business activity of this kind,
- if the applicant has been removed from the register of payment services providers as a result of a decision to prohibit such activity within the period of 3 years prior to the submission of the application
If the application meets the requirements indicated in the Act, the Financial Supervision Authority will enter the Small Payment Institution into the register within 3 months following the submission of the application. The date of entering into the register is unequivocal with the date of starting a business activity as a Small Payment Institution.
The activity of a Small Payment Institution
As part of its activities, the Small Payment Institution may perform all operations that are necessary to keep a payment account. In particular, it is allowed to accept cash deposits and make withdrawals from payment accounts. Its operations enable transferring the funds to the account of a selected provider and executing money transactions.
It is worth knowing that the Small Payment Institution may issue its own payment instruments as well as execute payment orders with their use.
A Small Payment Institution may keep the funds of its users on their payment accounts. It should be noted that the total amount of funds accepted for one user at any time may not exceed the equivalent of 2000 EUR. This amount is calculated based on the average exchange rate announced by the National Bank of Poland, applicable on the last day of the month preceding the given day.
The Small Payment Institution may provide its services only on the territory of the Republic of Poland.
Do you consider starting a business activity in the form of a Small Payment Institution? Specialists from our law firm will help you collect the required documents and prepare the application to the Polish Financial Supervision Authority. If necessary, they will also provide support in further stages of your business activity. Do not hesitate to contact us!