In accordance with the European Union’s Payment Services Directive (PSD2), the Czech Republic recognises and regulates payment service providers (PSPs).
Payment service providers operating in the Czech Republic must obtain the necessary licences and adhere to regulatory regulations. The Czech National Bank is the primary supervisory institution in charge of overseeing payment service providers and guaranteeing regulatory compliance.
Credit transfers, direct debits, card payments, electronic money transfers, and payment initiation services are all available from PSPs in the Czech Republic. Individuals, corporations, and organisations can use these services to make and receive payments in an efficient and secure manner.
Czech Republic is located in Central Europe. Because of its physical location, it is a natural intersection of major transit corridors. The Czech Republic is a democratic country with a stable political and social environment as well as a functional legal system.
According to Worldometer’s elaboration of the most recent United Nations data, the Czech Republic’s current population is 10,765,897 as of May 18, 2023.
Czech is the Czech Republic’s official language. Czech, which has roughly 11 million native speakers, is classed as a Slavic Indo-European language. Although many individuals in the Czech Republic have a basic understanding of English, learning a few important words in Czech will get you far.
Czech legal culture (civil law) belongs to the Germanic branch of continental legal culture. Civil, criminal, administrative, procedural, and labour law are among the major areas of public and private law that have been methodically codified.
1. Trust and Legitimacy
A PSP licence increases the credibility and legitimacy of your payment services firm. It displays that you have met all regulatory requirements and adhere to industry standards, which can aid in the development of trust with customers and business partners.
2. Access to the European Market
The Czech Republic is a European Union (EU) member and a member of the European Economic Area (EEA). Having a PSP licence in the Czech Republic can help you gain access to the larger EU market by allowing you to offer payment services across EU nations via the passporting process.
3. Regulatory Compliance
Obtaining a PSP licence assures compliance with applicable legislation and directives, such as the Payment Services Directive (PSD2), which is now in effect in the Czech Republic. Compliance with these regulations protects consumers and assures transaction security, increasing trust in your services.
4. Expanded Service Offerings
With a PSP licence, you can provide your customers with a broader choice of payment services, such as credit transfers, direct debits, card payments, electronic money transfers, and payment initiation services. This allows you to address a wide range of consumer needs and potentially acquire a larger customer base.
5. Enhanced Customer Experience
With a PSP licence, you can offer your consumers secure, dependable, and regulated payment services. This can lead to a better customer experience, which is critical for increasing customer happiness, loyalty, and repeat business.
6. Competitive Advantage
Being a licenced PSP can provide you an advantage in the market. It indicates your dedication to compliance, security, and professionalism, which can set your company apart from unlicensed or unregulated competition.
7. Potential Partnerships
Possessing a PSP licence may allow you to collaborate and partner with banks, financial institutions, and other regulated companies. These collaborations can result in expanded commercial prospects, access to new resources, and the capacity to provide complementary financial services
License: | Payment Service Provider |
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Timeframe for Approval: | 3 to 4 months |
Regulator: | The Czech National Bank (CNB) |
Local Director: | At least 2 directors (can be only natural persons) |
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Local Shareholder: | At least 1 shareholder (can be natural or legal persons, a legal person must be registered and be present in Czech Republic) |
Local Registered Office: | Required |
Local Staff: | Required |
Compliance Officer: | Required |
AML/KYC: | Required |
Audit: | Required |
Economic Substance: | Required |
Corporate Tax Rate: | 19% |
Currency: | Czech koruna (CZK) |
Capital Requirements: | Varies |
Tax Structure: | 0% Tax on Offshore Profits |
Because licencing is the responsibility of the Czech National Bank (CNB), the paperwork must be presented to this institution. They are as follows: