While Malta might not be as well-known as a fintech hub as, say, Amsterdam or Berlin, it punches well above its weight.
HQ to big names like eToro and Foris DAX, which operates crypto.com, and a slew of exciting homegrown firms, the country has a thriving fintech community.
Throw in a mature regulatory environment, advantageous tax treatment, and
the ease of doing business — plus 300 days of sunshine a year, let’s not forget about that — and it’s not hard to see why it’s one of the best EU jurisdictions for setting up a payments or crypto services firm.
A regulatory pioneer
As the first country in the world to implement a
comprehensive regulatory framework for crypto assets, Malta has two key advantages over other EU jurisdictions.
First, it offered clarity and legal certainty at a time when the EU was still debating what its approach to crypto-asset regulation should look like.
Second, Malta has over a decade of experience and a proven track record of regulating and servicing some of the biggest names in the industry. So much so, that the country’s regulatory framework significantly influenced the EU’s
Markets in Crypto-Assets regulation (MiCA), which came into force in June 2023
Malta’s approach to payment services has been equally pioneering.
The country enacted a first of its kind regulatory framework for standalone e-money institutions.
The Malta Financial Services Authority — Malta’s single regulator for financial services — also operates a
sandbox where early-stage startups can test product and market fit before kickstarting the process of obtaining a full licence.
This environment has made the country the
most popular EU jurisdiction for payment and e-money institutions, tied with Germany for most e-money licences issued in 2024.
Managing the day-to-day: Malta’s ease of doing business
Financial services is to Malta’s economy what oil and gas are to the Gulf states.
In 2024, it was one of the country’s fastest-growing industries, contributing 12% to its GDP. Growth driven mainly by asset management — 32.2% of financial services licensees are investment funds, investment services firms, and pensions, according to the
regulator’s
latest annual report (PDF).
As a result, Malta has a strong, highly interconnected network of lawyers, accountants, compliance specialists, IT specialists, and other financial services practitioners.
This specialised, experienced workforce does business in English — one of the country’s two official languages alongside Maltese. Which means there’s no language barrier to worry about.
Malta is also an e-commerce and igaming hub. These two industries have a high demand for payment services, making it easier for new payment institutions and e-money startups to gain a foothold in the market.
iGaming in particular is a multi-billion industry responsible for
12% of the country’s GDP, with 300 licenced firms and an annual event — the
SiGMA Summit — that hosts exhibitors, speakers, and prestigious industry awards.
A uniquely advantageous tax structure
Malta’s standard corporate tax rate is 35%. But dividend recipients get 30% of that tax back if the company’s beneficial owners aren’t domiciled in Malta or resident in Malta for tax purposes.
This brings the effective tax rate down to 5%, the lowest in the EU.
The structure also complies with ‘subject to tax’ regulation.
So, if a company’s dividend recipients reside in one of the
80+ countries with which Malta has double taxation treaties, Maltese tax law applies and you’re only taxed once.
How to obtain a payment services, e-money institution, or crypto asset service provider licence in Malta
The authorisation process for payment institutions, e-money institutions, and crypto asset firms is broadly similar:
Step 1: Submit a statement of intent
This is a high-level overview of your proposed activities and organisational structure. It must include an organogram and a business plan that sets out audit controls, which critical functions you intend to outsource and, if so, how you’ll approach it, and
AML/CFT compliance.
The organisational structure must follow the four eyes principle, with at least two qualified individuals, who are independent from each other, being physically present and effectively directing the firm’s business in Malta.
You’ll also need locally-based staff, including compliance, IT, risk management, finance and treasury, customer support, and other key operational teams.
Step 2: Full application
The documents required vary based on the licence.
In every case, qualifying shareholders must go through a fit and proper test. In the case of corporates, fit and proper requirements apply to directors, senior managers, the compliance officer, the money laundering reporting officer, and other key officers.
You’ll also need to prove you meet minimum initial capital requirements, explain how you’ll comply with ongoing capital requirements, prove your infrastructure is sufficiently robust, and submit organisational, business, and operational documents. The latter
include three-year financial projections, and an AML manual, risk management manual, IT security manual, a client asset safeguarding policy, and a business continuity policy.
Step 3: Approval in principle
This is a provisional licence, and includes a list of conditions you must comply with.
Once you satisfy all conditions, the MFSA issues a full licence and you can start doing business.
Malta: a safe pair of hands
Setting up a payments or crypto assets business is a huge investment (and undertaking). So it’s tempting — and perfectly understandable — to pick a jurisdiction with name-recognition.
But, at the end of the day, it’s what’s under the hood that counts. And, Malta is that rare case of a jurisdiction that ticks all the boxes: openness to and a proven track record in payments, investing, and the crypto and iGaming industries, pioneering regulations,
and highly experienced, English-speaking staff.
Throw in the extremely favourable tax treatment, there’s every reason for Malta to feature highly in any ambitious new firm’s plans.
