# PSD3 Article 7 — Calculation of own funds for payment institutions that do not issue electronic money

Textual state: amended_substantial. 87 words changed

- Current text: Council final compromise text (Council document 8222/26) — not yet law.
- Compared against: COM(2023) 366 final — superseded.
- Classification is mechanical; method: https://paymentslaw.eu/method/
- Editorial review state: not_assessed. Markers are curated and selective, not a complete assessment.

Word-level diff, proposal → compromise: `{+text+}` was inserted, `[-text-]` was deleted.

## Paragraph 1

1. Notwithstanding the initial capital requirements set out in Article 5, Member States shall require payment institutions, other than payment institutions that either only offer payment initiation services as referred to in Annex I, point (6), or only offer account information services as referred to in Annex I, point (7), or [-both, -]{+only both such services, +}and other than payment institutions [-offering -]{+that issue +}electronic money [-services, -]{+as referred +}to {+in Annex I, point (8), to +}hold own funds calculated in accordance with paragraph 2 at all times.

## Paragraph 2

2. Competent authorities shall require payment institutions to apply, by default, method B as laid down in point b) below. Competent authorities may however decide that, in light of their specific business model, in particular where they only execute a small number of transactions but of a high individual value, payment institutions shall rather apply method A or C. For the purposes of methods A, B and C, the preceding year is to be understood as the [-full -]12-month period prior to the moment of calculation. (a) Method A The payment institution’s own funds shall amount to at least 10 % of its fixed overheads of the preceding year. The competent authorities may adjust that requirement in the event of a material change in a payment institution’s business since the preceding year. Where a payment institution has not completed a full year’s business at the date of the calculation, payment institution’s own funds shall amount to at least 10 % of the corresponding fixed overheads as projected in its business plan, unless the competent authorities have required an adjustment to that plan. (b) Method B The payment institution’s own funds shall amount to at least the sum of the following elements multiplied by the scaling factor k referred to in paragraph 3, where payment volume (PV) represents one twelfth of the total amount of payment transactions executed by the payment institution in the preceding year: (i) 4,0 % of the slice of PV up to EUR 5 million; plus (ii) 2,5 % of the slice of PV above EUR 5 million up to EUR 10 million; plus (iii) 1 % of the slice of PV above EUR 10 million up to EUR 100 million; plus (iv) 0,5 % of the slice of PV above EUR 100 million up to EUR 250 million; plus (v) 0,25 % of the slice of PV above EUR 250 million. {+Where a payment institution has not completed a 12-month period of operation at the date of the calculation, the PV may be based on the total amount of payment transactions as projected in its business plan, unless the competent authority has required an adjustment to that plan. +}(c) Method C The payment institution’s own funds shall amount to at least the relevant indicator referred to in point (i), multiplied by the multiplication factor referred to in point (ii) and by the scaling factor k referred to in paragraph 3. (i) The relevant indicator shall be the sum of the following: (1) interest income; (2) interest expenses; (3) commissions and fees received; and (4) other operating income. Each element shall be included in the sum with its positive or negative sign. Income from extraordinary or irregular items shall not be used in the calculation of the relevant indicator. Expenditure on the outsourcing of services rendered by third parties may reduce the relevant indicator where the expenditure is incurred from an undertaking subject to supervision under this Directive. The relevant indicator shall be calculated on the basis of the 12-monthly observation at the end of the previous financial year. The relevant indicator shall be calculated over the previous financial year. Own funds calculated in accordance with method C shall not fall below 80 % of the average of the previous 3 financial years for the relevant indicator. When audited figures are not available, business estimates may be used. (ii) The multiplication factor shall be: (1) 10 % of the slice of the relevant indicator up to EUR 2,5 million; (2) 8 % of the slice of the relevant indicator from EUR 2,5 million up to EUR 5 million; (3) 6 % of the slice of the relevant indicator from EUR 5 million up to EUR 25 million; (4) 3 % of the slice of the relevant indicator from EUR 25 million up to 50 million; (5) 1,5 % above EUR 50 million.

## Paragraph 3

3. The scaling factor k to be used in methods B and C shall be: (a) 0,5 where the payment institution provides only the payment service as referred to in point (5) of Annex I; (b) 1 where the payment institution provides any of the payment services as referred to in any of points (1) to (4) of Annex I.

## Paragraph 4

4. Member States shall require that payment institutions other than payment institutions that either only offer payment initiation services as referred to in Annex I, point [-6, -]{+(6), +}or only offer account information services as referred to in Annex I, point [-7, -]{+(7), +}or [-both, -]{+only both such services, +}and other than payment institutions [-offering -]{+that +}only {+issue +}electronic money [-services -]{+as referred to in Annex I, point (8), +}that also engage in the activities referred to in Article [-10 -]{+10, +}ensure that the own funds held for the services listed in Annex I, points [-1 -]{+(1) +}to [-5, -]{+(5), +}are not considered as own funds held for the purpose of Article 10, paragraph 4, point (d) or other services not regulated under this Directive.

## Paragraph 5

5. Competent authorities may, based on an evaluation of the risk-management processes, risk loss data base and internal control mechanisms of the payment institution, require the payment institution to hold an amount of own funds which is up to 20 % higher than the amount which would result from the application of the method chosen in accordance with paragraph 2. Competent authorities may permit the payment institution to hold an amount of own funds which is up to 20 % lower than the amount which would result from the application of the method to be applied in accordance with paragraph 2.

## Paragraph 6

6. The EBA shall develop draft regulatory standards in accordance with Article 16 of Regulation (EU) No 1093/2010 concerning the criteria to determine when the payment institution’s business model is such that they only execute a small number of transactions, but of a high individual value, as referred in paragraph 2 of this Article. The EBA shall submit those draft regulatory technical standards to the Commission by [ OP please insert the [-date= -]{+date = +}1 year after the date of entry into force of this Directive]. Power is delegated to the Commission to adopt the regulatory technical standards in accordance with Article 10 to 14 of Regulation (EU) No 1093/2010.