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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
As an introduction it should be noted that the state Bosnia and Herzegovina (BiH) consists of three (3) separate territorial units i.e.: (i) the Federation of Bosnia and Herzegovina (FBiH); (ii) the Republika Srpska (RS); and (iii) the Brcko District of Bosnia and Herzegovina (BD). The three (3) units constitute separate jurisdictions which in some matters hold exclusive competence to legislate (e.g. financial services) in other matters share competences with the state level, and in third matters hold no competency (e.g. monetary policy). A minor part of the competencies is delegated further to local governance units such as cantons, municipalities and cities.
Modern payment services are highly popular in BiH and are currently centred around banks and services that are able to provide in this area. Most banks in BiH are now offering mobile banking services to their clients and each bank has implemented such solutions in order to maintain their market position. Based on the publicly available data, prepaid cards and e-wallets are least popular while mobile banking and payment performed via mobile phone are the most popular payment methods.
Legal affairs
Obligations and requirements to provide payment services or ancillary services described above
In BiH, the monetary policy is in the competence of the Central Bank of BiH. However, two (2) banking regulatory authorities, the Banking Agency of FBiH and the Banking Agency of RS, are authorised to supervise banking and financial services markets in the FBiH – i.e. RS. The forementioned banking regulatory bodies are authorised for: (i) issuance of permits for establishment of banks and micro-credit organisations, as well as the permits for all changes within the organisational structure of banks and micro-credit organizations; (ii) supervision of banking and micro-credit organisations operations; (iii) revoking banking and micro-credit organisations permits; (iv) managing or supervising the liquidation procedure of the banks; (v) performance of activities in support of anti-terrorist measures related to banks; and (vi) informing the Central Bank of BiH of all measures and action taken. It should be noted that in accordance with applicable legislation payment services can be performed only by licenced banks, while FinTech can only act as a service provider for those banks. All payment services within the scope of the relevant banking regulations require a permit issued by relevant banking agency, depending on the seat of the financial institution in question.
The documents necessary for obtaining the bank permits are as follows: (i) documents evidencing ownership structure and their financial status; (ii) business plan, setting out, inter alia, the types of activities envisaged for; (iii) organisational structure; (iv) share capital requirements proof; (v) documents evidencing the qualifications and experience of the supervisory board and management board; and (vi) internal control and audit. The minimum share capital amounts to BAM 15,000,000 (approx. EUR 7,500,000) in both FBiH and RS. The fee for obtaining the bank permit amounts to BAM 30,000 (approx. EUR 15,000) in FBiH and RS.