RegRally Insights: EMI/PI Regulation

ECOVIS ProentusLaw welcomes to its newsletter on recent regulatory developments for Electronic Money Institutions (EMIs) and Payment Institutions (PIs).

Bank of Lithuania Updates Supervisory Reporting Rules for EMIs, PIs, CASPs, and ART Issuers

Effective December 30, 2024, the Bank of Lithuania assumes supervisory authority over asset-referenced token (ART) issuers and crypto-asset service providers (CASPs), prompting a broad update to its data collection framework. The revised reporting obligations also affect existing electronic money and payment institutions (EMIs and PIs). Key changes include eliminating outdated reports (e.g., loan, employee, and complaints reports), simplifying and merging certain reporting forms, more precise requirements for supporting documentation, and introducing a new Funds Investment Report (VPT01) aligned with the 2026 investor protection rules. These adjustments aim to streamline oversight, reduce administrative burden, and prepare market participants for MiCA-aligned supervision.

All stakeholders are invited to review the proposed changes and submit their feedback by July 15 via one of the following channels:

By email: [email protected]
Through the Legal Acts Information System of the Seimas of the Republic of Lithuania.

CENTROlink Transition to Direct Access Model Underway, Completion Targeted for End of 2025

The Bank of Lithuania is actively migrating electronic money and payment institutions using its CENTROlink payment system to a direct participant model, replacing the previous addressed BIC structure. Since April 9, existing participants have begun signing new agreements, with three institutions—UAB Blue EMI LT, UAB Pervesk, and UAB Drauskaita—already operating under direct access. Sweden-based Steven AB is set to join as a direct participant on July 8. The transition, involving contract renewals and regulatory review, is proceeding in phases and is expected to be fully completed by the end of 2025, strengthening access control and regulatory alignment for the 136 active CENTROlink users, including 114 EMIs and PIs.

To ensure a smooth and timely transition, financial market participants are strongly advised to:

Assess internal compliance with updated criteria, including technical readiness, governance structure, and reporting obligations;
Ensure that all required documentation for migration is complete and accurate, submitted in timely manner.

Please do not hesitate to contact us if you need any assistance in terms of preparation for the transition to direct participation.

New IBAN Name Verification Rules to Take Effect from 9 October 2025

Starting 9 October 2025, all payment service providers in Lithuania—including banks, credit unions, EMIs, and PIs—must verify whether the payee’s name matches the IBAN holder before executing any SEPA or instant euro transfer. Based on the result—exact match, close match, no match, or verification failed—the payer is informed in real-time within the provider’s secure platform. While payers retain final control over whether to proceed, they assume liability if they confirm a mismatched transfer. However, payment service providers remain liable if verification errors lead to misdirected payments. The Bank of Lithuania warns users to avoid phishing attempts and not to trust name verification messages received via email or SMS. A dedicated FAQ section has been published to support implementation.

In light of this upcoming change, financial market participants are advised to:

Begin technical and procedural preparations early: ensure IT systems and payment processing environments are updated to support real-time name and IBAN verification functionalities.
Review internal policies and Terms and Conditions: align internal processes with the new rule, especially regarding responsibility and liability in cases where mismatches are ignored or the verification fails due to technical reasons.

Bank of Lithuania Sets Stricter Governance, Risk, and Internal Control Standards for EMIs and PIs

In June 2025, the Bank of Lithuania held a dedicated event outlining enhanced expectations for governance, risk management, and internal controls applicable to electronic money institutions (EMIs) and payment institutions (PIs). Amid rising payment volumes and a shift toward higher-risk clients, the Bank presented new legal requirements—effective January 1, 2026—mandating clear internal accountability, agent oversight, and risk-aligned governance structures. Institutions must also prepare a mandatory wind-down plan by April 9, 2025, detailing how services will be terminated with minimal impact. Emphasis was placed on ensuring resident, competent, and independent decision-makers and avoiding “empty shell” structures. Institutions must align their business models with licensing scope, integrate risk frameworks across operations, and strengthen oversight of outsourced services to meet prudential and supervisory expectations.

Financial market participants shall thoroughly familiarise themselves with the Bank of Lithuania’s updated supervisory expectations and upcoming regulatory changes.

Please do not hesitate to contact us if you need any assistance in preparing for the upcoming legal requirements and implementation of the regulatory changes.

Reminder on Reporting

Please make sure that by June 1st, you have submitted the reports to the State Tax Inspectorate as per the deadlines indicated in the Excel reporting calendar. This includes:

Reporting on client’s annual turnover, if the total yearly turnover of all accounts held by the same person with the same financial market participant is at least EUR 15,000;
Reporting on client’s balance, if the total annual balance of accounts of the same person with the same financial market participant at the end of the year is not less than EUR 5,000;
The debt obligations owed to a financial market participant as at 31 December of the calendar year.

Please ensure that you submit the reports on the reportable account to the State Tax Inspectorate by July 1st.

Please also be aware that the second quarter has ended, meaning the following reports must be submitted.

This includes:

Statistical Payment data and Statistical data on Fraudulent Payments
Reports for supervision of the implementation of money laundering and terrorist financing prevention measures;
Financial reports (always be aware of the capital adequacy requirements).