Regulation of 10 April 2018 of the National Bank of Belgium concerning the own funds of payment institutions

Title

2018A12004

10 APRIL 2018. - Regulation of 10 April 2018 of the National Bank of Belgium concerning the own funds of payment institutions (NOTE: Consultation of versions prior to 08-05-2018 and update as of 17-06-2026)

Source: Finances

Publication: 8 May 2018

Number: 2018A12004

page: 38525

File number: 2018-04-10/01

Entry into force: 8 May 2018

This text modifies the following text:

2010A03085

1 archived version

Section 1st. - General provision, definitions and scope Art. 1-3 Section 2. - Own funds Art. 4-8 Section 3. - Coefficients and solvency standards Art. 9-10 Section 4. - Levels of application of requirements Art. 11 Section 5. - Final provisions Art. 12-13

Text

Section 1st. - General provision, definitions and scope

Article 1st. This regulation ensures the partial transposition of Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC.

Art. 2. For the application of this regulation, the following shall be understood by:
1° "the law": the law of 11 March 2018 on the status and supervision of payment institutions and electronic money institutions, on access to the activity of payment service providers, on the activity of electronic money issuance and on access to payment systems; 2° "the Bank": the National Bank of Belgium; 3° "Regulation No 575/2013": Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012; 4° "Regulation of 4 March 2014": the regulation of the National Bank of Belgium of 4 March 2014 on the implementation of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013; 5° "group": a group of undertakings within the meaning of Article 2, 42° of the law.

Art. 3. The provisions of this regulation apply to Belgian payment institutions.

Section 2. - Own funds

Art. 4. The own funds of the payment institution must permanently be at least equal to the amount of initial capital fixed in accordance with Article 17 of the law.

Art. 5. Eligible and recognisable own fund elements are those defined as such in Part Two of Regulation No 575/2013 and calculated according to the procedures provided for in that Regulation. Articles 5 and 34 of the Regulation of 4 March 2014 apply.

Art. 6. Tier 1 own funds must consist of at least 75% of Core Tier 1 own funds referred to in Article 50 of Regulation No 575/2013. Tier 2 own funds represent a maximum of one-third of Tier 1 own funds.

Art. 7. Without prejudice to the provisions provided for in Articles 8 to 10 of this regulation, the Bank assesses the solvency of the payment institution, with regard to all its activities, including hybrid activities referred to in Article 44 of the law.

Art. 8. If a payment institution exercises, directly or indirectly, activities other than those mentioned in Annex I.A of the law, the Bank is empowered to determine the measures to be taken by that institution to prevent the multiple use of eligible elements for the calculation of own funds. [1 For what concerns more specifically the activity of granting credits linked to payment services meeting the conditions of Article 44, § 3 of the law, the Bank ensures, in accordance with Article 44, § 3, 4° of the law, that the payment institution allocates an amount of own funds at least equivalent to 8% of the risk-weighted volume calculated according to the standard method in accordance with Part Three, Title II, Chapter 2 of Regulation No 575/2013.]1. [1 When the institution chooses, with the agreement of the Bank, not to calculate the risk-weighted volume of credit on the basis of the standard method, the weighting applied to the risk exposure value as defined in Part Three, Title II, Chapter 2 of Regulation No 575/2013 is 100 %]1. [1 For what concerns the activity of granting credits not meeting the conditions of Article 44, § 3 of the law, the Bank bases its assessment of solvency on the provisions of Part Three, Title II, Chapter 2 of Regulation No 575/2013]13. ---------- (1)<AR 2026-06-05/16, art. 1, 002; En vigueur : 17-06-2026>

Section 3. - Coefficients and solvency standards

Art. 9. § 1st. The own funds of the payment institution must permanently be at least equal to the amount of solvency requirements calculated according to one of the methods defined in paragraph 2. The Bank determines the method that may be applied by a payment institution after having consulted on this matter with the concerned payment institution. § 2. 1° Method A The amount of own funds of the payment institution is at least equal to 10% of its general expenses of the previous year. The Bank may adjust this requirement in case of significant modification of the activity of the payment institution compared to the previous year. When the payment institution has not recorded a full year of activity at the date of calculation, the own funds requirement is equal to 10% of the amount of general expenses provided for in its business plan, unless the Bank requires an adjustment of this plan. For the application of this method, the general expenses taken into consideration consist of:
a) various goods and services; b) remuneration, social charges and pensions; c) depreciation, impairments and provisions for risks and charges; d) other operating expenses, with the exception of amounts which the payment institution establishes are directly linked to the volume of activity. 2° Method B The amount of own funds of the payment institution is at least equal to the sum of the following elements, multiplied by the scale factor k determined in paragraph 3, where the volume of payments (VP) represents a twelfth of the total amount of payment transactions executed by the payment institution during the previous year:
a) 4.0% of the VP tranche up to 5 million EUR, plus b) 2.5% of the VP tranche between 5 million EUR and 10 million EUR, plus c) 1% of the VP tranche between 10 million EUR and 100 million EUR, plus d) 0.5% of the VP tranche between 100 million EUR and 250 million EUR, plus e) 0.25% of the VP tranche above 250 million EUR. When the payment institution has not recorded a full year of activity at the date of calculation, it takes into account in its calculation the total amount of payment transactions provided for in its business plan, unless the Bank requires an adjustment of this plan. 3° Method C The amount of own funds of the payment institution is at least equal to the applicable indicator defined in point a), after application of the multiplication factor determined in point b), then of the scale factor k determined in paragraph 3. a) The applicable indicator is the sum of the following elements:

interest income
interest expenses,
commissions and fees received, and
other operating income.
Each element is included in the sum with its sign, positive or negative. Exceptional or unusual income cannot be used to calculate the applicable indicator. Expenses related to the outsourcing of services provided by third parties may reduce the applicable indicator if they are incurred by a company subject to supervision under the law. The applicable indicator is calculated on the basis of a twelve-month observation carried out at the end of the previous financial year. It is calculated on the previous financial year. However, own funds calculated according to Method C cannot be less than 80% of the average of the three previous financial years for the applicable indicator. When audited figures are not available, estimates may be used. When the payment institution has not recorded a full year of activity at the date of calculation, it takes into account in its calculation the applicable indicator provided for in its business plan, unless the Bank requires an adjustment of this plan. b) The multiplication factor is equal to:
10% of the tranche of the applicable indicator up to 2.5 million EUR,
8% of the tranche of the applicable indicator between 2.5 million EUR and 5 million EUR,
6% of the tranche of the applicable indicator between 5 million EUR and 25 million EUR,
3% of the tranche of the applicable indicator between 25 million EUR and 50 million EUR,
1.5% of the tranche of the applicable indicator above 50 million EUR.
§ 3. The scale factor k to be used to apply Methods B and C is equal to:
0.5 when the payment institution provides only the payment service mentioned in point 6 of Annex I.A of the law;
1.0 when the payment institution provides one of the payment services mentioned in points 1 to 5 of Annex I.A of the law.

Art. 10. The Bank may, on the basis of an assessment of the risk management processes, databases concerning loss risks and the internal control devices of the payment institution, require that the payment institution hold an amount of own funds that can be up to 20% higher than the own funds requirement determined in Article 9, or authorise the payment institution to hold an amount of own funds that can be up to 20% lower than the own funds requirement determined in Article 9.

Section 4. - Levels of application of requirements

Art. 11. § 1st. When it deems it necessary to guarantee an adequate level of solvency at group level, the Bank may decide to apply the provisions of this regulation on a consolidated basis to a parent payment institution or a subsidiary payment institution of a financial holding company in a group that does not hold any credit institution, securities firm, portfolio management company nor insurance companies. In this case, Articles 6, paragraph 1, 7, 11, 18, 19 and 22 of Part One, Title II of Regulation No 575/2013, as well as Articles 3 and 4 of the Regulation of 4 March 2014 apply by analogy. § 2. If the conditions provided for in Article 7 of Regulation No 575/2013 are met, the Bank may exempt from the application of Articles 4 to 10 of this regulation a payment institution that is part of the consolidation perimeter of a credit institution.

Section 5. - Final provisions

Art. 12. The regulation of 19 January 2010 of the Banking, Finance and Insurance Commission concerning the own funds of payment institutions is repealed.

Art. 13. This regulation enters into force on the day of entry into force of the Royal Decree approving it.

Signatures

Brussels, 10 April 2018.
The Governor,
J. SMETS
Vu for being annexed to Our Decree of 27 April 2018 approving the regulation of 10 April 2018 of the National Bank of Belgium concerning the own funds of payment institutions.
PHILIPPE
By the King:
The Minister of Finances,
J. VAN OVERTVELDT

Preamble

The National Bank of Belgium,
Having regard to Article 12bis of the law of 22 February 1998 fixing the organic status of the National Bank of Belgium; Having regard to the law of 11 March 2018 on the status and supervision of payment institutions and electronic money institutions, on access to the activity of payment service providers, on the activity of electronic money issuance and on access to payment systems, in particular Article 33; Having regard to Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC, Articles 8 and 9, Decrees:

Modification sheet

Royal Decree of 05-06-2026 published on 17-06-2026

Article modified: 8

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