It depends on one thing: whether your product holds a balance the customer can spend again. If it does, you are issuing electronic money and need an EMI. If you only move money, an API covers it. Singapore treats both as payment services and grades them by size: SPI or MPI.
Most teams arrive at this question from the product side. They have a wallet, a card programme and a stablecoin rail, and they want to know which three-letter authorisation to apply for. The regulators arrive from the opposite direction. They do not ask what your product is called. They ask whether the money sitting in your system belongs to your customers, and whether those customers can spend it again.
Answer that, and the choice between an electronic money institution (EMI), an authorised payment institution (API) and a Singapore major payment institution (MPI) is largely made for you. Get it wrong and you will discover it late, usually when a banking partner or a card scheme reads your permissions and stops the onboarding.
Does your product hold a redeemable balance?
The cleanest statutory test in English is in the UK's Electronic Money Regulations 2011. Regulation 2 defines electronic money as "electronically (including magnetically) stored monetary value as represented by a claim on the electronic money issuer which — (a) is issued on receipt of funds for the purpose of making payment transactions; (b) is accepted by a person other than the electronic money issuer; and (c) is not excluded by regulation 3" (legislation.gov.uk).
Three limbs, and all three have to be present. Read them against your own screens:
- A wallet balance a user tops up, sees on a dashboard and later spends with a merchant satisfies every limb. That is e-money, whatever your product team calls it.
- A payment that leaves the payer's bank, passes through your rails and lands with the payee — with no user-owned, re-spendable balance created anywhere — is the execution of a payment transaction, not the issuance of e-money.
The first needs an EMI. The second can be done by an API. The capital requirement is the clearest signal of how differently regulators view the two: an applicant for authorisation as an electronic money institution must hold initial capital of at least EUR 350,000 (Electronic Money Regulations 2011, Schedule 2), while a payment institution's initial capital is EUR 125,000, EUR 50,000 or EUR 20,000 depending on which services it provides (Payment Services Regulations 2017, Schedule 3). Both regimes are administered by the Financial Conduct Authority.
Is card issuing a regulated activity in its own right?
Yes — and it is more modest than most founders assume. "Issuing payment instruments or acquiring payment transactions" is listed as a payment service at paragraph 1(e) of Schedule 1 to the Payment Services Regulations 2017. Issuing a card is therefore squarely a payment service, and an API's permissions can reach it.
What escalates the requirement is not the plastic. It is the float. A prepaid card carrying a balance your company holds on the cardholder's behalf, spendable at third-party merchants, is e-money by the definition above — and that pushes the programme from API territory into EMI territory.
What changes when the balance is a stablecoin?
In the European Union, quite a lot. Article 48(1) of the Markets in Crypto-Assets Regulation provides that a person shall not offer an e-money token to the public or seek its admission to trading in the Union unless that person is the issuer and "(a) is authorised as a credit institution or as an electronic money institution; and (b) has notified a crypto-asset white paper to the competent authority and has published that crypto-asset white paper in accordance with Article 51". Article 48(2) then states flatly that "E-money tokens shall be deemed to be electronic money" (ESMA Interactive Single Rulebook, MiCA Article 48).
Article 49 adds the economics: e-money tokens are issued at par value on receipt of funds; the holder may demand redemption at any time and at par, paid in funds other than electronic money; and redemption "shall not be subject to a fee" (MiCA Article 49). If your model assumed a redemption spread or a withdrawal charge on a euro-referenced token, that assumption does not survive contact with the text.
Singapore approaches the same problem from the issuer's balance sheet. On 15 August 2023 MAS announced the final features of its stablecoin regulatory framework, which applies to single-currency stablecoins pegged to the Singapore dollar or any G10 currency and issued in Singapore. Issuers must meet requirements on reserve asset composition, valuation, custody and audit; on minimum base capital and liquid assets; on returning par value to holders within five business days of a redemption request; and on disclosure. Only issuers meeting every requirement may apply to have their stablecoin labelled an "MAS-regulated stablecoin", and misrepresenting a token as one carries penalties (MAS media release, 15 August 2023).
Note the boundary carefully. Issuing a stablecoin and accepting one are different businesses. Most payment and card products do the second: they take stablecoin in, settle fiat out, and the token is somebody else's liability. That still engages payment or crypto-asset service authorisations, but it does not make you an issuer.
Where does Singapore's MPI fit?
Singapore has no separate EMI licence. MAS regulates seven types of payment service under the Payment Services Act 2019 — account issuance, domestic money transfer, cross-border money transfer, merchant acquisition, e-money issuance, digital payment token services and money-changing (MAS). E-money issuance is only one of them, and scale decides the licence class. MAS grants three licence types — money-changing, standard payment institution (SPI) and major payment institution (MPI) — and publishes the thresholds that separate them.
| Authorisation | Minimum capital | Size limit that applies |
|---|---|---|
| UK authorised EMI | EUR 350,000 initial capital | None — full authorisation |
| UK authorised payment institution | EUR 20,000 / 50,000 / 125,000 by service | None — full authorisation |
| UK small EMI (registration) | Scaled to outstanding e-money | Average outstanding e-money not above EUR 5m; monthly average relevant payment transactions not above EUR 3m |
| UK small payment institution (registration) | Not specified in Schedule 3 | Monthly average payment transactions not above EUR 3m |
| Singapore SPI | S$100,000 base capital | S$3m monthly per service; S$6m across two or more; S$5m daily outstanding e-money |
| Singapore MPI | S$250,000 base capital | None of the above thresholds apply; security of S$100,000 or S$200,000 required before starting business |
MAS also expects a Singapore-incorporated company or Singapore branch, a permanent place of business where records are held, and a board that includes at least one executive director who is a Singapore citizen or permanent resident — or an Employment Pass holder plus one citizen or PR director (MAS licensing page).
Is the small registration route a shortcut?
It is a real route with a hard ceiling. A small payment institution must have a monthly average of payment transactions over the preceding twelve months not exceeding EUR 3 million, and the business must not include account information services or payment initiation services (PSRs 2017, regulation 14). A small electronic money institution must not generate average outstanding e-money above EUR 5 million, must stay under the same EUR 3 million monthly transaction average, and faces the same AIS/PIS exclusion (EMRs 2011, regulation 13).
For a card programme with any ambition, those ceilings arrive quickly, and the ceiling is not the only cost: a registration is a domestic permission, so it does not carry you into other markets. The right question is not whether the small route is enough today. It is what the migration looks like when it is not.
Three product shapes, and where they usually land
- Merchant settlement. You accept stablecoin from a payer and settle fiat to a merchant. No user-held balance persists. The decisive questions are whether funds pass through accounts you control and whether the acceptance side is a regulated crypto-asset service in your target market.
- A consumer card with a wallet. Users top up, hold a balance and spend it. That balance is the licence driver: e-money in the UK and EU, an e-money issuance service in Singapore, with your seat in the card chain determining whether you need issuing permissions yourself.
- B2B cross-border payouts. Business clients instruct payments; funds are in flight, not stored. Often reachable as an API or, in Singapore, as an SPI until volume crosses the thresholds above.
What an adviser can and cannot tell you
CryptoLicense (CL GLOBAL SDN BHD, registration number 1421939-T) is a licensing and compliance advisory firm — not a regulator, not a law firm. This article is general information and not legal advice. Our coverage is 10+ Jurisdictions Covered across five continents; the list is on our jurisdictions overview.
What we do is decide which authorisation your product structure actually requires, draft and assemble the application, build the compliance framework the regulator will test, and introduce the entity to banking, issuing and settlement counterparties. What we do not do is promise an outcome. Every authorisation decision sits entirely with the regulator, which retains full discretion to refuse. Progress also depends on both sides — you responding in time, and some stages moving at the authority's own pace.
If you are still choosing between markets rather than between licences, start with licence selection; the survey of payment routes and their supervisors is on fintech licences.
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