How to register as a deferred payment service provider
Registration is a regulated process whereby you can become a participant in Latvia's financial market and start operating after registration.
A commercial company that provides a deferred payment service and is a large undertaking within the meaning of Section 1, Clause 26 of the Consumer Rights Protection Law, i.e. has more than 250 employees and an annual turnover exceeding EUR 50 million and/or an annual balance sheet total exceeding EUR 43 million, must register with the Register of Deferred Payment Service Providers (DPSPs).
A deferred payment service is a credit granted by the seller of goods or the service provider itself to a customer, allowing the payment for the received goods or service to be made later.
A DPSP may be, for example,
- a retailer that allows the customer to pay for goods later;
- a service provider that allows the customer to pay for the service after its receipt;
- a provider of digital content or digital services that offers deferred payment for their services.
Registration applies to large undertakings if they provide only deferred payments repaid in more than 50 days, or to deferred payments of large online undertakings repaid in full in more than 14 days.
Learn what entrepreneurs need to do and know at each stage of obtaining an authorisation, what Latvijas Banka does, and what the application review deadlines are.
1. Preparation for the submission of an application
Preparation for the submission of an application: the familiarisation stage, during which Latvijas Banka organises a meeting with the entrepreneur to discuss the planned activities.
What does the entrepreneur do?
- Prepares information on their current or planned activities in the area of the deferred payment service.
- Prepares general information on their existing internal arrangements and procedures related to the area of the deferred payment service.
- Starts drawing up the necessary draft documents.
What does Latvijas Banka do?
- Provides consultations on the applicable regulation.
- Explains the process of document review and decision-making at Latvijas Banka and the deadlines.
- Explains the collaboration process between Latvijas Banka and the entrepreneur.
- Conducts the initial document assessment.
- Provides consultations on the documents to be submitted.
What should be taken into account?
- Carefully familiarise yourself with the requirements of legal acts:
- Assess the need to engage consultants.
Costs
Latvijas Banka provides assistance with preparing an application and offers consultations free of charge.
Submission of an application: the entrepreneur prepares and submits the registration application.
What does the entrepreneur do?
- Submits a fully completed application along with all necessary information and documents in accordance with the requirements established in the Regulation on the Registration of Deferred Payment Service Providers.
- Receives information from Latvijas Banka on the commencement of the registration process or on any shortcomings to be addressed in the application.
- Provides the necessary additional explanations.
What does Latvijas Banka do?
- If all necessary documents have been received, Latvijas Banka begins the assessment. If the necessary documents have not been received, Latvijas Banka requests additional information and explanations.
- Latvijas Banka assesses the application and takes a decision within the time frame specified by the Administrative Procedure Law.
What should be taken into account?
- Take advantage of the consultations offered by Latvijas Banka before submitting your application.
- Ensure the documents to be submitted are complete and of high quality.
- Check whether all necessary documents have been submitted (refer to the list of documents to be submitted).
List of documents to be submitted
The commercial company submits an application for registration.
The following documents and information must be attached to the application:
- a confirmation of the good repute of the member of the DPSP's executive board responsible for the provision of the deferred payment service and for anti-money laundering and countering the financing of terrorism and proliferation, as well as a confirmation of the good repute of the stockholder (shareholder) (Appendix 2). If the stockholder (shareholder) of the DPSP is a natural person, they provide the aforementioned confirmation. If the stockholder (shareholder) of the DPSP is a legal person, the confirmation is provided by the members of the legal person's executive board. The aforementioned confirmation regarding the stockholder (shareholder) can also be provided by the DPSP;
- the DPSP-approved internal procedure for the provision of the consumer credit service, setting out the arrangements for granting credit and monitoring the credit issued;
- the procedure for assessing a consumer's ability to repay the credit under Section 8 of the Consumer Rights Protection Law;
- the DPSP-approved procedure for handling consumer complaints to ensure that received complaints are addressed and responses are provided within a reasonable time frame;
- the DPSP-approved description of the internal control system for anti-money laundering and countering the financing of terrorism and proliferation in relation to the deferred payment service in accordance with the requirements established in the laws and regulations on anti-money laundering and countering the financing of terrorism and proliferation;
- general information for consumers in line with Paragraph 31 of Cabinet Regulation No 691 "Regulations Regarding Consumer Credit" of 25 October 2016;
- information to be provided to a consumer before concluding a credit agreement (Chapter IV of Cabinet Regulation No 691 "Regulations Regarding Consumer Credit");
- the draft credit agreement.
Please note that the commercial company must appoint an executive board member responsible for anti-money laundering and countering the financing of terrorism and proliferation, as well as approve and submit to Latvijas Banka a description of the internal control system for anti-money laundering and countering the financing of terrorism and proliferation in relation to the deferred payment service in accordance with the requirements established in the laws and regulations on anti-money laundering and countering the financing of terrorism and proliferation after Regulation (EU) 2024/1624 of the European Parliament and of the Council of 31 May 2024 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing comes into force and the DPSPs become subject to it – on 10 July 2027.
Assessment of the application: Latvijas Banka carries out a substantive assessment of the application.
What does the entrepreneur do?
- Follows the application review process.
- Responds to Latvijas Banka's requests for additional information as soon as possible.
- Makes corrections to the submitted documents in line with Latvijas Banka's instructions.
- Participates in the meetings held by Latvijas Banka.
What does Latvijas Banka do?
- Carries out a substantive assessment of the application.
- Communicates with the entrepreneur's contact person in case any shortcomings have been identified.
- Draws up a letter in case any shortcomings have been identified in the application.
- Continues reviewing the application in line with the supplementary information.
- Completes the assessment of the application.
What should be taken into account?
- Provide additional explanations and make the necessary corrections as soon as possible.
- Representatives of the entrepreneur, rather than only consultants (if engaged), are also invited to participate in the meetings held by Latvijas Banka.
Costs
No costs are incurred at the application assessment stage.
Registration: Latvijas Banka's experts complete the assessment of the application and submit their draft decision to the Supervision Committee of Latvijas Banka. The Supervision Committee decides whether to approve or refuse registration.
What does the entrepreneur do?
- Prepares to start providing the deferred payment service.
- In case of registration, provides users with access to Latvijas Banka's eSTAT system for future communication with Latvijas Banka and submission of performance reports.
What does Latvijas Banka do?
- Prepares a draft decision on approval or refusal of registration.
- Sends the adopted decision to the entrepreneur.
- Registers the DPSP with the Register.
What should be taken into account?
- The legal acts published on the website of Latvijas Banka and binding on the DPSPs.
- Information for reporting agents published on the website of Latvijas Banka.
- Information related to electronic data reporting to Latvijas Banka.
Costs
At the stage of registration, the DPSP pays Latvijas Banka a fee of EUR 1500 for reviewing the documents and information submitted for registration.
Supervision: Latvijas Banka supervises the activities of the DPSPs in accordance with the laws and regulations governing consumer rights protection.
What does the DPSP do?
- Responds to Latvijas Banka's requests.
- Draws up reports in accordance with the requirements of laws and regulations.
- Notifies Latvijas Banka of any changes to the documents submitted for the registration of its activities.
- Reports significant incidents in the course of providing the DPSP services.
- Becomes acquainted with the DPSP's curator designated by Latvijas Banka.
What does Latvijas Banka do?
- Designates the DPSP's curator.
- Assesses compliance of the DPSP's activities with the requirements of laws and regulations.
- Requests additional information on the activities and performance indicators of the DPSP.
- Examines the reports submitted and supervisory information.
What should be taken into account?
- In case of uncertainties, contact the curator designated by Latvijas Banka.
- Submit reports and the requested supervisory information on a regular basis.
- Report any changes to the documents submitted for registration, including any changes to officials or stockholders.
Costs
Following registration, the DPSP pays Latvijas Banka a supervisory fee in accordance with Latvijas Banka's regulations. The fee is set in line with the Consumer Rights Protection Law, and the DPSP pays Latvijas Banka an annual fee of EUR 5000 and an additional fee of up to 0.033% (inclusive) of the average value of the DPSP's portfolio of loans granted to consumers in each calendar quarter. The total annual fee payable by the DPSP to Latvijas Banka is capped at EUR 100 000.
Deferred payment service providers registration guide
Meeting with prospective market participants
Latvijas Banka's experts offer consultations to prospective market participants to help them better understand the regulatory requirements applicable to the registration process, as well as identify possible challenges.
However, the entrepreneur needs to have a clear understanding of what they want to do and how they intend to operate. Latvijas Banka will not draw up documentation on behalf of the entrepreneur or enhance submitted projects to the level at which they meet the required quality standards. This is the sole responsibility of the entrepreneur and their engaged consultants.
Apply for a consultation
To agree on a meeting time, please contact us in advance by e-mail