We are excited to announce that Mintos submitted the application for both an investment firm license and electronic money institution license with the Latvian regulator Financial and Capital Market Commission (FCMC) on 30 March 2020.
We are convinced that regulation will help us with a sustainable growth of Mintos and will benefit our investors. Our goal is to offer the same Mintos experience, just in a regulated environment that adds value with increased investor protection and allows us to expand our services. Both licences will allow such services to be provided across the EU and EEA.
Regulatory oversight
Before issuing the licenses, the FCMC will thoroughly assess Mintos’s business model, financial soundness, as well as the reputation and qualifications of Mintos’s management and shareholders. Once we’re licensed, the FCMC will regularly assess that Mintos follows submitted procedures and policies and has AML compliance systems in place.
Increased investor protection
As an investment firm, Mintos will be subject to strict investor protection rules under EU financial industry legislation MiFID II. This includes organisational requirements around capital requirements, best execution, prevention of conflicts of interest, and product governance. Investors also will be protected under the state-guaranteed investor protection system that safeguards up to € 20 000 per investor in case the investment firm defaults. Finally, Mintos will need to follow conduct requirements, such as tests to assess whether the investment is suitable and appropriate for the investor’s knowledge, financial situation, and objectives.
As an electronic money institution, Mintos will be subject to the new EU legislation PSD2, which provides additional protection and safety for Mintos investors, such as the requirement to hold client funds in a segregated account with the EU bank, and much more.
New services
Our main service will continue to be investments in loans. At the same time, we are excited that we’ll be able to provide a wide range of additional services to investors. We already have strong plans to offer IBAN accounts and Mintos payment cards. Further down the road, the licenses will also allow us to add a variety of additional investment services, from facilitating investments in standard financial instruments (such as stocks, bonds, and ETFs) to portfolio management, investment advice, and possibly market research.
To achieve these goals, Mintos has significantly strengthened its finance, product and engineering, operations, compliance, and legal functions with senior-level experts and managers, many having 10+ years of experience in leading financial institutions and fintech companies.
While formally submitting both license applications is a major milestone, we have done a lot of pre-application and preparatory work over the last year, in close cooperation with FCMC experts and Big Four professional services advisors. This includes a road show of Mintos’s business model, drafting and implementing internal policies and procedures, and setting up new IT systems. We expect to receive the licenses in 3-6 months. In the meantime, major implementation work is being done by our product and engineering teams to smoothly launch new services and products shortly after the licenses are issued.
We are very much looking forward to receiving the licenses and creating even more value for our investors.
