1. In terms of the Financial Institutions Act (FIA), a financial institution license may be obtained provided the below-mentioned minimum prudential criteria are complied with.
2. Under the FIA, a financial institution is a person who regularly or habitually:
- acquires holdings (with the intention of eventual re-sale)
or
- undertakes the carrying out of any activity listed in the Schedule of the FIA
for the account and at the risk of the person carrying out the activity,

provided that these activities are not funded through the taking of deposits or other repayable funds from the public as defined in the Banking Act,
and
provided further that the FIA shall not apply to any of the above activities which is regulated under the Investment Services Act.

3. The licensable activities under the FIA which a licensed financial institution may carry out comprise any one or more of the following:
- lending activities;
- financial leasing;
- venture or risk capital activities;
- money transmission services;
- issuing and administering means of payment;
- guarantees and commitments;
- trading for own account or for account of customers in: money market instruments, foreign exchange, financial futures and options, exchange and interest rate instruments, transferable instruments;
- underwriting share issues and the participation therein;
- money broking.
4. A financial institution carrying out any business in or from Malta must be in possession of a valid license granted under the FIA by the MFSA. The minimum prudential requirements in order the so licensed consist essentially of the following elements:
i. Own funds (initial capital), to be determined on a case-by-case basis (and not established by law), appropriate to the type of activities to be undertaken by the applicant;
ii. A minimum of two individuals who will effectively direct the business of the financial institution in Malta;
iii. Fitness and properness of all of the financial institution’s:
- Qualifying shareholders (i.e. shareholders holding at least 10% of the equity shares of the company),
- Controllers,
- Persons who will effectively direct the business of the financial institution,
in order to ensure its sound and prudent management;

iv. The MFSA must be satisfied that no close links exist between the company and another person/s which through any law, regulation, administrative provision or in any manner prevent the MFSA from exercising effective supervision of that company under the provisions of the FIA.
5. An applicant desiring to obtain a financial institution licence shall submit a written application form to the MFSA together with the following minimum documents:
i. A copy of the Memorandum and Articles of Association of the institution;
ii. Audited financial statements for the last three years, if applicable;
iii. A Business Plan incorporating the structure, organisation and management systems of the institution as well as all financial information relative to the determination of the Own funds requirement;
iv. Disclosure of the identity of all officers and controllers of the institution;
v. Disclosure of the identity of all shareholders having a qualifying shareholding;
vi. Disclosure of the identity of the individuals who will be effectively directing the business of the institution.
The MFSA reserves the right to demand additional information as it may deem appropriate in order to enable the determination of an application for a financial institution licence.

6. Where the MFSA decides to grant a licence, it may grant a licence without condition, or otherwise, a licence subject to such conditions it may deem fit in the particular case.
7. The licensing fees payable by financial institutions to the MFSA under the FIA comprise:
- a One-time Application and processing fee: Euro 1,200
- a One-time Licensing fee upon the granting of a license: Euro 1,800
- an Annual supervision fee (a percentage of the Balance Sheet total): not less than Euro 2,500 and not more than Euro 50,000


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