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Digitial Wallet for Electronic Payments

Generally, there are two types of licenses companies are looking for ‘Payment Services Provider’ and ‘Digital Wallet for Electronic Payments’.

Payment Services Provider
Activity Description: Includes firms engaged in providing payment services on behalf of payment industry members such as, telecommunication companies, public departments and others, whether via payment kiosk or mobile phones, the process involves network establishment and technology provision, supply of payment tools as well as hardware and software, data center

Digital Wallet for Electronic Payments
Activity Description: Includes firms engaged in providing digital wallet which refers to an electronic device that works through apps on the electronic devices and smartphones, and which allows an individual to make electronic transactions, including purchasing items on-line or at a store, the individual’s bank account can also be linked to the digital wallet or it can be rechargeable.

The Payment Services Provider license is quite straight forward and does not require any additional approvals. I have attached the proposal for your reference.

The Digital Wallet for Electronic Payments License does require additional approval. One of the main requirements is that it must be owned 50% by a bank, financial institution, telecommunications company or monetary exchange. I have also attached the requirements for this business activity.

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Requirements for the Digital Wallet and Electronic Payments License:

  1. A Digital Wallet and Electronic Payments  License will not be entitled to possess more than one (1) Digital Wallet and Electronic Payments license
  2. An institution intending to provide digital payment services shall first submit a Digital Wallet and Electronic Payments license application (to be approved) accompanied by a nonrefundable application fee
  3. Prior to submitting the license application, such legal person(s) must confirm/ verify its eligibility to the Digital Wallet and Electronic Payments license category (and requirements thereof) below:
    • Retail Digital Wallet and Electronic Payments license
    • Micropayments Digital Wallet and Electronic Payments license
    • Government Digital Wallet and Electronic Payments license
    • Non-issuing Digital Wallet and Electronic Payments license

Conditions for a Digital Wallet and Electronic Payments License
1. The application must contain all documents specified in the Licensing Manual including the submission of a business plan.
2. The application must satisfy the eligibility requirements
3. The application must comply with the licensing requirements
4. The applicant must be incorporated in the United Arab Emirates including free zones, (excluding UAE financial Free Zones);
5. The applicant must provide evidence of its ability to provide digital payment services, via third-party references, demonstrating relevant experience in digital payments within the UAE or a foreign country;
6. The applicant must demonstrate to the satisfaction of the Central Bank that its directors and persons responsible (for its management) have the appropriate skills and knowledge to provide digital payment services.

Validity of a PSP/Digital Wallet and Electronic Payments License
• The Digital Wallet and Electronic Payments license shall be valid for a fixed period of time from the issuance date of the certificate
• During the period of the validity of the license, if the Digital Wallet and Electronic Payments intends to implement substantial changes/ enhancement to the business, it shall notify and obtain written approval from the Central Bank for the proposed changes at least sixty (60) days prior to the introduction of such changes.

Ownership Requirements
1. Retail Digital Wallet and Electronic Payments – A commercial bank or a consortium of commercial banks must own more than fifty percent (50%) of the total outstanding shares of the Retail DIGITAL WALLET.

2. Micropayments Digital Wallet and Electronic Payments – The Micropayments Digital Wallet and Electronic Payments shall be majority-owned by one (1) or a consortium of the following institutions:
? A Commercial Bank
? A Telecommunication Service Provider /Operator
? A Transport Services Entity and;
? A Monetary / Financial intermediary

 To find out more, schedule a call or meeting with one of our consultants to guide you through the process. 

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We are here to guide you on the right path to setting up your business successfully. We will help you determine the suitable business activity and ensure you have a full understanding of the different business structures and jurisdictions available. We will give you all the possible License Options in Dubai so that you can have complete transparency over your options. You can choose the activity that matches your business objectives and future business plans.