Electronic money institution
An electronic money institution (EMI) is a firm authorised to issue electronic money and operate payment accounts under specialised payments regulation rather than a full deposit-taking bank licence.1 In the UK and EU, many early neobanks and fintechs—including Wise and early Revolut—operated as EMIs before or instead of becoming banks.
Overview
EMIs hold customer funds as electronic money, typically safeguarded (segregated) rather than used for balance-sheet lending like a bank. They can offer IBANs/payment accounts, cards and FX, but face limits on deposit-like products and credit compared with licensed banks.
Versus banks and partner banks
A licensed neobank such as Monzo takes deposits and can lend. An EMI issues e-money. A partner-bank fintech may own the app while a bank or EMI sits underneath. Customers often experience these models similarly inside a mobile app.
Examples
Wise is a canonical multi-currency EMI-style business. Qonto and other European business finance apps have used e-money or specialised licences. Some firms upgrade from EMI to bank status over time (Revolut).
References
- Electronic money institutions are authorised under EU/UK e-money and payments rules to issue electronic money. https://www.fca.org.uk/firms/electronic-money-payment-institutions
Frequently asked questions
- What is Electronic money institution?
- An electronic money institution (EMI) is a regulated firm that issues electronic money and payment accounts without a full bank charter.
See also
- Airwallex — Airwallex is an Australian-founded business fintech for global accounts, payments and spend management.
- Alex Johnson — Alex Johnson is the founder of Fintech Takes, a widely read fintech newsletter and podcast; he is active on X as @AlexH_Johnson.
- Alexandre Prot — Alexandre Prot is co-founder and CEO of Qonto, the Paris-based European business neobank.
- Ali Niknam — Ali Niknam is founder and CEO of Bunq, the Amsterdam-based licensed Dutch neobank.
- Ally Bank — Ally Bank is a large U.S. online bank offering deposits, loans and investment products without branches.