Guide to Obtaining an Electronic Money Institution License in El Salvador with Zitadelle AG

El Salvador’s progressive financial ecosystem, driven by its adoption of digital currencies and commitment to financial inclusion, makes it an ideal market for Electronic Money Providers (SPDEs). As a leading consultancy, Zitadelle AG specializes in guiding businesses through the process of securing an SPDE license under the Superintendency of the Financial System (SSF) in El Salvador. This SEO-optimized guide outlines the requirements, process, and benefits of obtaining an SPDE license, leveraging Zitadelle AG’s expertise to ensure compliance with the Law to Facilitate Financial Inclusion, NASF-04, and NASF-07 norms.

Why Choose El Salvador for Electronic Money Services?

El Salvador’s fintech-friendly environment, bolstered by its 2021 adoption of Bitcoin as legal tender, creates opportunities for innovative financial services. The Central Reserve Bank’s registry (https://registrobitcoin.bcr.gob.sv/web/proveedores-registrados) lists authorized SPDEs, though many are currently inactive, offering a competitive edge for new entrants. For instance, TransferMate, through its subsidiary Transferencias de El Salvador, S.A., received SSF approval in May 2024 to operate as an SPDE, demonstrating the market’s potential. With Zitadelle AG’s expert guidance, businesses can navigate this landscape efficiently.

Key Requirements for an SPDE License

The SSF regulates SPDEs under the Technical Norms for the Constitution of Electronic Money Provider Companies (NASF-04) and Technical Standards for the Start of Operations (NASF-07). Zitadelle AG ensures clients meet all requirements seamlessly. Below are the key steps and documentation needed.

1. Application and Incorporation Requirements

To incorporate as an SPDE, Zitadelle AG assists clients in preparing:

• Formal Application: Details of interested parties, including full name, age, profession, identification, Tax ID (NIT), domicile, and nationality.

• Shareholder Information:

  • For individuals: Full name, ID, NIT, domicile, nationality, subscription amount, and participation percentage.

  • For legal entities: Company name, NIT, domicile, tax registration number, subscription amount, and participation percentage.

• Legal Representative: If applicable, details and a certified copy of accreditation.

• Feasibility Study:

  • Business Plan: Services, target market, marketing strategies, financial projections (minimum 3 years), risk analysis, and mitigation measures.

  • Operational Model: Expected transaction volume and hardware/software for system connections.

  • Governance Structure: Administration, internal controls, and operational areas.

  • Risk Management: Operational, technological, AML/CFT (SARLAFT), credit, and liquidity risks.

• AML/CFT Plan: A robust Anti-Money Laundering/Combating the Financing of Terrorism plan aligned with Salvadoran and FATF standards.

• IT Infrastructure: Detailed IT systems, information security, disaster recovery, and contingency plans for real-time operations.

Zitadelle AG’s consultants ensure all documentation is comprehensive and compliant, minimizing delays.

2. Minimum Capital Requirements

The SSF mandates a minimum capital of US$232,310.00 (updated from US$500,000). Zitadelle AG advises on:

• Full subscription and payment in cash, deposited with the Central Reserve Bank (BCR).

• Documenting the origin of funds to meet AML requirements.

• Staying updated on biennial adjustments based on the Consumer Price Index.

3. Requirements for Commencement of Operations

Once incorporated, Zitadelle AG supports clients in meeting operational requirements:

• Operations Application: Submitted by the SPDE’s legal representative.

• Deed of Incorporation: A legible copy, including the legal representative’s appointment, registered with the Commercial Registry.

• Board Certification: Confirming the initial electronic money balance.

• Technical Compliance: Ensuring secure and efficient infrastructure, verified by the SSF.

• Electronic Money Backing: Full backing of electronic money by BCR deposits.

• Fee Transparency: Quarterly publication of fees and surcharges in a national newspaper and office displays.

• Staff Training: Documented training on electronic money services and risks.

4. Ongoing Obligations

Zitadelle AG ensures clients maintain compliance with:

• No Financial Intermediation: Funds are used solely for payments and transfers.

• Customer Transparency: Clear, accessible information for clients online and in-person.

• Transaction Limits: Adherence to BCR-set balance and transaction limits.

• Reporting: Periodic submissions to the SSF and BCR on operations and compliance.

• Security Measures: Robust transaction security and data protection.

• Inactive Funds: Transfer of funds from accounts inactive for five years to the State.

How Zitadelle AG Facilitates the SPDE License Process

Zitadelle AG offers end-to-end support for businesses seeking an SPDE license:

1. Document Preparation: Compile and review all required documents, ensuring compliance with SSF standards.

2. Company Registration: Assist in establishing a Limited Liability Company (SRL) and registering with the Commercial Registry.

3. Capital Compliance: Guide on depositing the minimum capital of US$232,310.00 with the BCR and documenting fund origins.

4. Application Submission: File the incorporation application per NASF-04, addressing SSF feedback promptly.

5. SSF Review Support: Facilitate the review process, which may take up to 20 business days, ensuring completeness to avoid delays.

6. Operational Setup: Prepare operations application per NASF-07, ensuring technical and backing compliance.

7. Ongoing Compliance: Provide tools and strategies for maintaining SSF and BCR requirements post-approval.

Benefits of an SPDE License with Zitadelle AG

• Market Opportunity: Capitalize on inactive providers to gain market share in El Salvador’s fintech sector.

• Regulatory Expertise: Zitadelle AG’s knowledge of NASF-04 and NASF-07 ensures a smooth application process.

• Financial Inclusion: Align with El Salvador’s mission to expand financial access, enhancing brand credibility.

• Crypto-Friendly Environment: Leverage potential tax exemptions and digital asset opportunities.

Challenges and How Zitadelle AG Mitigates Them

• AML/CFT Compliance: Zitadelle AG develops robust AML policies to meet FATF and Salvadoran standards, addressing cryptocurrency-related risks.

• Operational Costs: Strategic planning minimizes financial burdens of capital and reporting requirements.

• Competition: Zitadelle AG’s market insights help clients differentiate in a growing field, as seen with recent entrants like TransferMate.

• Regulatory Updates: Continuous monitoring of SSF adjustments ensures clients remain compliant.

Why Partner with Zitadelle AG?

With extensive experience in fintech compliance, Zitadelle AG is the trusted partner for navigating El Salvador’s SPDE licensing process. Our tailored consultancy services streamline documentation, ensure regulatory alignment, and position clients for success in a dynamic market.

Ready to launch your SPDE in El Salvador? Contact Zitadelle AG today to start your journey toward becoming a licensed Electronic Money Provider.