Name
Global FinTech Guide
Country _ Name
Bulgaria
SectionTitle
Payment services
Body
FinTechs belonging to this category offer alternative payment services which are supposed to provide a faster and cheaper way for national, European, and international payments for private and business customers by using new technologies.

For example, payment service providers hereby offer solutions to easily integrate several payment services in online shops.

Some FinTechs furthermore provide real cash register systems and online-reservation solutions for restaurants and shops providing their own payment services or making use of the payment services of FinTechs described above.

Introduction

Attitude of the country towards modern payment services

E-commerce has evolved significantly in recent years, driving the use of more convenient, fast and secure payments which in their turn are causing consumers in Bulgaria to change their attitude towards cashless payments. In 2024, the number of card payments in the country grew by 19.05% compared to 2023 (according to the year-on-year statistics of the Bulgarian National Bank, and payments with digitized cards through digital wallets also grew significantly. All leading Bulgarian banks and other financial institutions in Bulgaria all note that the growth of cashless payments is significant and plan to minimize cash payments as much as possible in the next 10 years which is reflected in the trend for the decrease of the number of ATM machines in the country.

Bulgaria, however, falls behind the European standard when it comes to the number of POS terminals and devices. By 2024, there were about 25 of those per 1000 people 2023 (according to the year-on-year statistics of the Bulgarian National Bank and the Bulgarian Statistics Institute), which is significantly less than the European average. Because of this, Bulgaria is expected to skip a step in the development of payment services, as the growth in digitized payments, for which POS terminals are not necessary, will continue increasing. The cashless payments rate is expected to double by 2027.

According to  Statista (https://www.statista.com/outlook/fmo/payments/digital-payments/digital-commerce/bulgaria)  Bulgaria's digital commerce market is expected to reach EUR 3.1 billion by the end of  2025, with a CAGR of ~17.9% from 2025 to 2030.



Legal affairs

Obligations and requirements to provide payment services or ancillary services described above

In Bulgaria, payment services are regulated by the Payment Services and Payment Systems Act (PSPSA), which transposes the second Directive (EU) 2015/2336 on payment services in the internal market (PSD2). Bulgarian and EU legislation in the field of data protection and anti-money laundering must also be complied with. A significant number of ordinances and other secondary legislation issued by the Bulgarian National Bank (BNB) should also be observed by providers of such services

Pursuant to PSPSA, payment service providers must be licensed or registered to act as such by the competent authority of their home EU Member State. The competent authority for issuing licenses and registrations for payment service providers based in Bulgaria is the Bulgarian National Bank.

The costs of acquiring a license range up to 50 000 BGN (approximately EUR 25 600) depending on the number and the kind of payment services being provided. 

Applicants must fulfill a number of requirements set out in PSPA, such as having a clear business strategy, for example: how many and what types of payment services they would be providing; rules and procedures for the management of activities related to the provision of these services; depending on the number and types of payment services, a payment institution needs initial capital ranging from 40 000 BGN (approximately EUR 20 500) to 250 000 BGN (approximately EUR 128 000). An applicant must also be registered or in the process of being incorporated as one of two specific types of trading companies (OOD or AD) within the meaning of the Commercial Act.

Payment service providers based in EU Member States and licensed in accordance with the legislation of these Member States may operate as such in Bulgaria if they go through a minimal set of regulatory requirements for the recognition of their license – the so-called passporting procedure.



Additional comments regarding the legal situation for payment services or what FinTech’s must be aware of in this business area

N/A



Economic conditions

Market size for payment services and biggest payment service providers

Payment services occupy the largest part of the Fintech market in Bulgaria. According to the payment statistics for Bulgaria, collected from all payment service providers and branches of payment service providers licensed by the Bulgarian National Bank, the number of card payments made with payment cards last year was 570 million and their value was BGN 40.4.2 billion. The biggest payment service providers both in terms of number and value of transactions are the local banks. Non-bank payment institutions have a relatively smaller market share as they focus on offering niche solutions to particular market segments.



Additional comments regarding the economic situation for payment services or what FinTech’s must be aware of in this business area

Developments in payment services will continue to grow at a high pace. In mid-2023, a new European regulation for payment and e-money services was proposed, showing that regulatory developments are keeping pace with industry developments. The sector is very attractive to foreign investors as EU or EEA Member States mutually recognize licenses for payment services issued in the territory of another member state.



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