5 key takeaways
- EMI (Electronic Money Institution) can issue e-money AND provide payment services — KIP (Payment Institution) can only provide payment services, not issue e-money
- If your business model involves issuing digital wallets, prepaid cards or stored value — you need an EMI licence, not a KIP
- Initial capital requirement: €350,000 for EMI
- Both licences are granted by KNF and allow EU passporting — but EMI authorisation might be more demanding and takes longer
- Small payment institutions have lighter regimes — but with activity and volume caps
If you are building a fintech business in Poland that involves handling customer funds, the first regulatory question is almost always the same: do I need an EMI or a KIP licence? As one of Poland’s leading fintech lawyers advising on KNF authorisation, I answer this question regularly — and the distinction matters more than most founders initially realise.
This post sets out the key differences, helps you identify which licence fits your business model, and explains what the KNF authorisation process involves for each.
EMI vs KIP Payment Licence Poland: What Each Licence Covers
What is an EMI (Electronic Money Institution)?
An EMI — instytucja pieniądza elektronicznego in Polish law — is authorised to:
- Issue electronic money (stored monetary value represented by a claim on the issuer, accepted as payment by persons other than the issuer)
- Provide payment services listed in Annex 1 to the Payment Services Directive (PSD2)
In practice, an EMI licence is required if your business stores customer funds in a digital wallet, issues prepaid cards, or operates any stored-value product. Furthermore, because EMIs can also provide payment services, an EMI licence gives you the broadest scope of activities.
What is a KIP/MIP (Payment Institution)?
A MIP — mała instytucja płatnicza (small payment institution) or krajowa instytucja płatnicza (domestic payment institution) — is authorised to:
- Provide payment services listed in Annex 1 to PSD2 — including money remittance, account information services, payment initiation services, and card-based payment services
Importantly, a MIP cannot issue e-money. Consequently, if your product involves any form of stored value or digital wallet that customers use to make payments, a KIP licence alone is insufficient.
EMI vs MIP: The Comparison Table
| Feature | EMI | PI (KIP) | SPI (MIP) |
|---|---|---|---|
| Issue e-money | ✅ Yes | ❌ No | ❌ No |
| Provide payment services | ✅ Yes | ✅ Yes | ✅ Yes (limited) |
| Initial capital | €350,000 | €20,000–€125,000 (depending on the services provided) | None |
| Activity cap | None | None | Monthly volume cap |
| EU passport | ✅ Yes | ✅ Yes | ❌ No |
| Safeguarding required | ✅ Yes | ✅ Yes | ✅ Yes |
| KNF authorisation | Full licence | Full licence | Registration |
| Typical timeline | 6–12 months | 4–8 months | 2–4 months |
EMI vs Payment Institution Licence Poland: The Capital Difference
EMI initial capital
The minimum initial capital for a full EMI authorisation in Poland is €350,000. Additionally, ongoing own funds requirements apply based on the volume of e-money in circulation and payment services provided. Hybrid EMIs — entities that carry on non-e-money business alongside e-money issuance — must maintain separate capital for the e-money activity.
PI (KIP) initial capital
Initial capital requirements for a payment institution depend on which payment services the entity provides:
- €20,000 — for money remittance only
- €50,000 — for payment initiation services
- €125,000 — for all other payment services (including account information, card-based payments)
Small payment institutions (małe instytucje płatnicze) have no minimum capital requirement — but they are subject to a monthly transaction volume cap and cannot passport into other EU Member States.
Which Licence Does Your Business Model Need?
You need an EMI if:
- You issue prepaid cards or digital wallets where customers store funds
- Your product involves stored monetary value that customers can use to make payments
- You want to offer both e-money issuance and payment services under one licence
- You need EU passporting rights for both e-money and payment service activities
You need a PI (KIP) if:
- You provide payment services (money remittance, payment initiation, account information, card-based payments) but do not issue e-money
- You need EU passporting for payment services
- Your business involves holding customer funds for payment execution but not storing value for future use
You may consider a small payment institution if:
- You are at an early stage and your monthly transaction volumes are below the regulatory cap
- You operate only in Poland (no EU passporting needed)
- You want a faster, lighter registration route to test your business model before applying for a full licence
The KNF Authorisation Process
Both EMI and MIP licences are granted by the Komisja Nadzoru Finansowego (KNF). In practice, the authorisation process involves:
Preparation: drafting the business plan, governance documentation, safeguarding arrangements, AML/CFT policies, internal controls framework, and IT security assessment. Specifically, KNF scrutinises the business plan closely — it must demonstrate a realistic path to profitability and sustainable compliance.
Application: submitting the full application package to KNF. Additionally, each member of the management body must pass a fit and proper assessment.
Review: KNF has a statutory decision period of 3 months from receipt of a complete application — but in practice, KNF frequently issues questions and requests for additional information, which suspends the statutory clock and extends the timeline.
Decision: KNF grants or refuses the licence. Consequently, preparation quality has a direct impact on timeline — incomplete or poorly drafted applications significantly extend the process.
One Common Mistake: Choosing PI When You Need EMI
The most frequent mistake I see is a fintech business applying for a PI licence when its product actually involves e-money issuance. This typically happens because founders focus on the payment execution layer of their product and overlook the stored-value component.
A digital wallet where customers top up funds and then spend them is e-money. A platform that initiates payments directly from a customer’s bank account (without holding funds) is a payment initiation service — a PI covers that. The line between the two is not always obvious in product design, and getting it wrong means going back to KNF for a different authorisation.
If you are unsure which licence your business model requires, this is exactly the kind of question worth resolving before you begin the application process — not after KNF raises it.
Bottom Line on EMI vs KIP Payment Licence Poland
The choice between an EMI and a MIP licence in Poland depends primarily on one question: does your product involve issuing stored monetary value, or only executing payments? If stored value is involved, you need an EMI. If not, a MIP or small payment institution may be sufficient.
Both routes lead through KNF, and both require careful preparation. The right licence for your business is the one that matches your actual product — not the one with the lowest initial capital requirement.
If you have questions about payment licensing in Poland or KNF authorisation, get in touch. You can also find more information on the FinTech, Banking & Financial Regulation practice area page.
Katarzyna Szczudlik is a Partner at Schoenherr in Warsaw, ranked by Chambers & Partners among Poland’s top FinTech lawyers. She advises payment institutions, fintechs and crypto-asset businesses on KNF licensing and EU regulatory compliance. Get in touch.
