Crowdfunding License Costs in Different Countries in Europe
How much it costs to license a crowdfunding platform is one of the major questions businesses ask when it comes to entering the market.
According to the European Crowdfunding Service Providers Regulation (ECSPR), all crowdfunding operators must obtain a license to perform their crowdfunding activities in Europe.
Crowdfunding platforms should get this license from a local authority, but the license application procedure and costs in different countries also vary. This is why some regions and countries may be more preferable. So platforms choose the best price, time, clarity and stability of the crowdfunding market.
Here, we will explore the crowdfunding platform licensing costs and some other financial obligations of crowdfunding platforms in different EU countries.
What you will learn in this post:
Germany: 2,000 – 17,000 EUR
Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin), the German Federal Financial Supervisory Authority, is responsible for issuing licenses for companies that provide financial services, including crowdfunding service providers. A business’s board of directors or management must make the application for the license in writing.
BaFin charges a fee of 2,000 – 17,000 EUR for businesses that provide financial services to which crowdfunding service providers belong. Additional costs, such as those for legal advice, may arise.
Some law firms provide a fixed-rate service for the BaFin license application; it is recommended that you ask for the cost in advance.
Business owners should also consider that the company must meet a minimum capital requirement of 50,000 EUR for financial service providers to apply for a BaFin license.
Poland: not more than 4,500 EUR
The Polish Financial Supervision Authority (Komisja Nadzoru Finansowego, KNA) is supervising crowdfunding platforms and issuing crowdfunding licenses in Poland. The regulator establishes a fee of no more than 4,500 EUR for granting a permit. Additionally, crowdfunding platforms must pay annual fees to cover the cost for the Financial Service Authority supervision.
Lithuania: 710 EUR
The Bank of Lithuania oversees the issuing of crowdfunding licenses in the country. A company willing to get a license of a crowdfunding provider in Lithuania shall register as a Lithuanian corporate entity and hold a minimum of 25,000 EUR in capital.
Before submitting the application documents, the company pays the state fee of 710 EUR for the issuing of a crowdfunding license. The fee is paid to the account of the State Tax Inspectorate.
After that, the application documents may be submitted to the Bank of Lithuania for revision. The Bank of Lithuania assesses the completeness of the application and verifies whether all the documents have been submitted within 25 days. If there are any missing documents or information, the regulator sets a deadline for the company to provide them. Otherwise, the application is canceled.
Once all documents are complete, within three months from the date of the application submission, the regulator assesses whether the applicant meets the licensing criteria and makes an informed decision on whether to issue a license.
Latvia: 2,500 EUR
The Bank in Latvia provides licenses to businesses that want to operate as crowdfunding service providers. To apply for a license, a company shall have its own funds amounting to at least 25,000 EUR, or provide an insurance policy, or a combination of its own funds and an insurance policy. Then, the company gathers all the required documentation for the application and pays a fee of 2,500 EUR for revising the documents.
Once the license is issued and the company is registered in the list of crowdfunding service providers, it pays a 4,000 EUR annual fee and up to 1.4% of its gross revenue (but not more than 100,000 EUR) on a yearly basis.
The Netherlands: $100,000 EUR and more
The Netherlands market looks promising, however, getting a crowdfunding provider license there is complicated.
The Dutch Authority for the Financial Markets (AFM) and De Nederlandsche Bank (DNB) are the regulators responsible for licensing and supervising crowdfunding service providers. In addition to the application cost, which is not fixed, additional fees are applied. So, the regulators perform so-called propriety and fitness assessments of management board members and supervisory board members. The fee for a propriety assessment is 700 EUR per person. The fee for a fitness assessment varies, starting from 175 EUR per hour and not exceeding 150,000 EUR. These fees are paid even if the license application is rejected if the assessment is terminated by the applicant, or if the assessment was not carried out within the allotted time.
This means that the total cost of applying for a crowdfunding license in the Netherlands may easily reach 100,000 EUR or even exceed it. Notably, these costs do not guarantee that the license will be eventually provided.
Luxembourg: 30,000 EUR
The Commission de Surveillance du Secteur Financier is responsible for licensing and supervising financial service providers, including crowdfunding platforms. The regulator charges the following fees to cover its staff, financial, and operating costs.
- A crowdfunding service provider pays a single lump sum of 30,00 EUR for the examination of its authorization request.
- For each on-site inspection conducted on a specific topic, the platform pays a lump sum of 10,000 EUR.
Along with the licensing fees, annual fees are paid. So, a crowdfunding service provider pays a lump sum of 10,000 EUR each year, and a variable amount of a maximum of 30,000 EUR calculated based on the total amount financed in projects over the preceding year. The variable amount is calculated as follows:
| Less than EUR 1 million financed | 0% |
| EUR 1 – 5 million financed | 0.25% |
| EUR 5 – 55 million financed | 0.04% |
| Over EUR 55 million | 0% |
France: 2,500 EUR
In France, Autorité des Marchés Financiers (AMF) oversees issuing licenses to crowdfunding service providers. To start with the application, the company must have a minimum capital of at least 50,000 EUR and submit all the requested documentation for authorization. If the crowdfunding service provider is going to engage in facilitating loan provisions, the AMD notifies the Autorité de Contrôle Prudentiel et de Résolution (ACPR).
When the authorization is granted, the platform pays a contribution to the AMF in the amount of 2,500 EUR.
How to start a crowdfunding platform with LenderKit
Building a crowdfunding platform in compliance with regulations is a challenging task. Luckily, LenderKit white-label crowdfunding software has got you covered. Unless it hasn’t, we offer full crowdfunding software customization services from front-end to back-office and API, so you can operate a truly unique and regulations-compliant platform.
If you’d like to learn more about the LenderKit investment software, feel free to get in touch with us via the contact form.
