Payment Systems in Georgia: PSP Registration, E-Money and What the National Bank Expects

Payment activity in Georgia is regulated by the Law of Georgia on Payment Systems and Payment Services, administered by the National Bank of Georgia. The National Bank maintains the register of payment service providers and of payment system operators, and supervises them together with the anti-money-laundering framework set out in the Law of Georgia on Facilitating the Prevention of Money Laundering and the Financing of Terrorism.

Two points follow from that framework and shape everything below. First, supervision is bifurcated: the National Bank sets and enforces prudential and conduct rules, while the Financial Monitoring Service of Georgia is the financial intelligence unit that receives the reports your AML programme produces. Second, the National Bank fills in the primary law with secondary acts - regulations, ordinances and reporting forms - so the operative detail of what an applicant must show is found across the law and the regulator's own rules rather than in a single document.

What counts as a payment service

The Law on Payment Systems and Payment Services defines the regulated services. In outline, these include:

• Executing payment transactions, including transfers and direct debits.
• Issuing payment instruments and acquiring payment transactions - the merchant-acquiring business.
• Money remittance.
• Issuing electronic money, which is treated as its own category with its own conditions.
• Operating a payment system, which is supervised separately from providing payment services.
• Payment initiation and account information services, in line with the open-banking direction Georgia has been taking.

Electronic money is its own category

Issuing electronic money - stored value that a holder can redeem and use to pay third parties - is treated as a distinct activity rather than a variety of ordinary payment services. In practice it attracts its own conditions: electronic money must be issued at par against funds received, funds held against outstanding e-money must be safeguarded, and the holder must be able to redeem at any time. If your product loads value that customers spend later, assume you are in the e-money category and scope it as such from the start, because the capital and safeguarding expectations differ from a pure transfer business.

Registration with the National Bank

A provider must be registered before offering the service. What the National Bank examines, in practice:

• Legal form and ownership: a Georgian legal entity with transparent ownership up to identifiable beneficial owners.
• Fit and proper: the suitability, experience and reputation of owners, directors and key function holders. Criminal or regulatory history in the chain is a common cause of refusal.
• Capital: minimum capital appropriate to the category of service, maintained on an ongoing basis rather than only at application.
• Safeguarding of client funds: segregation of client money from the provider's own funds, with the mechanism described and evidenced.
• Governance: an organisational chart, internal control functions, risk management, business continuity and outsourcing arrangements.
• Technology and security: information security, incident reporting, fraud controls and the resilience of the platform.
• AML/CFT: a full programme, an appointed responsible officer, customer due diligence procedures, transaction monitoring, sanctions screening and reporting to the Financial Monitoring Service of Georgia.

Capital, treated as a live condition

The minimum capital the National Bank expects varies with the category of service and, for e-money, with the volume of value outstanding. The point that catches applicants is not the figure but its character: capital is an ongoing requirement, not a one-off box to tick at filing. The regulator expects the entity to hold it continuously, to report against it, and to remain above the threshold as the business grows. Budget capital as money that must genuinely sit in the company, not as a number produced for the application and then withdrawn.

Safeguarding, and why it is separate from capital

Safeguarding answers a different question from capital. Capital protects against the provider's own business risk; safeguarding protects customers if the provider fails. The National Bank expects client funds to be segregated from the provider's own money - typically held in a separate account with a credit institution, or otherwise ring-fenced - so that customer balances are identifiable and returnable and never form part of the provider's estate. The application has to describe the safeguarding mechanism concretely and evidence that it operates, not merely assert that client money is kept safe.

Fit and proper, and governance

Fit-and-proper review looks through to the people who own and run the business: the suitability, experience, honesty and financial soundness of owners, directors and key function holders. Adverse criminal or regulatory history anywhere in the ownership or management chain is one of the most common reasons an application stalls or fails. On governance, the National Bank expects to see functioning internal control, risk management, compliance and audit arrangements, clear reporting lines, business continuity, and any outsourcing described and controlled rather than assumed.

The AML programme is the centre of gravity

For payment businesses, the anti-money-laundering file carries more weight than any other part of the application. It has to be a working system, not a document. Expect to show:

1. A risk assessment of the business - customers, products, geographies and channels - with a documented methodology.
2. Customer due diligence, enhanced due diligence triggers, and the treatment of politically exposed persons.
3. Ongoing monitoring, with defined scenarios and thresholds, and what happens when one fires.
4. Sanctions screening against the lists the business is exposed to, with a false-positive procedure.
5. Suspicious transaction reporting, record retention, staff training and independent testing.

Ongoing obligations after registration

Registration is the beginning of a supervised relationship, not the end of the project. Once registered, a provider carries continuing duties: maintaining capital and safeguarding on a live basis, periodic prudential and statistical reporting to the National Bank, notifying the regulator of material changes to ownership, management or the business model, meeting conduct and customer-information standards, handling complaints, reporting security incidents and major operational disruptions, and keeping the AML programme current and tested. A firm that treats these as optional invites supervisory measures; the National Bank can require remediation and, in serious cases, restrict or withdraw the registration.

Timeline and cost, honestly

A payment registration is a months-long project, not a filing. The variables that drive it are the completeness of the application, the regulator's questions, and how quickly the applicant can produce evidence rather than intentions. Cost splits into state charges, professional fees for the legal and compliance build, technology and audit, and the capital that must actually be there. Anyone quoting a fixed all-in price before scoping the business model is guessing.

The alternatives worth considering first

• Agent or distributor of a licensed provider, which lets a business go to market under someone else's authorisation while it builds its own.
• White-label or Banking-as-a-Service arrangements with a licensed institution.
• Restricting the model so the business never touches client funds - for example, pure software or referral - which takes it out of the regulated perimeter entirely.

How Trustlex works on payment files

We start with a regulatory perimeter analysis: what the product actually does with money, and which of the defined services that maps onto. That produces a written answer on whether registration is required, which category applies, and what the realistic route and cost look like - before any commitment. Where the answer is that the model does not need a licence, we say so.