Small Payment Institution in Poland – new requirements

Pursuant to Article 117h(2)(1) of the Polish Payment Services Act, Small Payment Institution is obliged to have a program of operations and a financial plan for the first 12 months of its activity. Program has to take into account the requirement not to exceed the equivalent of EUR 1 500 000 of the average total amount of payment transactions over the previous 12 months performed by the Small Payment Institution. A properly drawn up business plan should be correct in formal, factual and accounting terms.

Formal correctness is expressed in the completeness in terms of essential elements and in the layout of the content according to the minimum standards referred to below.

Substantive correctness is primarily the correctness of the data and assumptions made, as well as their plausibility, i.e. the correspondence of the initial data with the actual state of affairs and the correspondence of the assumed values with the rational, probable scenario of the company’s development in the given market and macroeconomic conditions.

Accounting accuracy consists of the correct, orderly and free of accounting errors presentation of financial statements presenting input data, output data and the indicators and measures resulting from the compilation of these data.

In terms of minimum standards, the SPI’s program of activities should, include:

• strategic assumptions;
• a marketing plan including:
  1. characteristics of the services provided,
  2. characteristics of the target client group,
  3. an analysis of the services provided by other suppliers to the extent that these suppliers are in competition with SPI,
  4. a pricing strategy,
  5. a description of the intended channels of distribution and promotion of services;
• an operating plan containing data on:
  1. capital expenditures and sources of their financing,
  2. sources of funding for operational activities,
  3. implementation of legal and supervisory requirements for the operation of the SPI,
  4. the policy on the outsourcing of payment services, including the applicant’s contractual rights and obligations,
  5. the technology used, taking into account the design of the IT systems architecture, including a description of the production and back-up IT environment, a description of the technical security features and tools, the way in which transactions are monitored, data flows, the software used and the security of data and systems,
  6. the flow of information between all parties involved in the execution of a payment order and the flow of funds between accounts, indicating the sequence in which they occur in the provision of payment services;
• an organization and management plan, containing in particular a description of the organizational structure, the powers of the organs or managers, the employment policy, as well as the applicant’s internal regulations and procedures, including those relating to corporate governance, internal control, accounting and auditing;
• a timetable setting out the planned dates for the achievement of the various business milestones and strategic objectives set out in the business plan. The financial plan, on the other hand, should include revenues, costs, profits and losses, capital expenditures, capital requirements, sources of funding for operations, cash flow, balance sheet and financial evaluation with an assessment made on the basis of the statements of the financial plan and an indicator assessment.