A bank is a credit institution: the only type of company allowed to take deposits and other repayable funds from the public and lend them on its own account. Any firm that wants to hold customer deposits in Lithuania, rather than safeguarded e-money or payment funds, needs a banking licence.
Lithuania is in the euro area, so bank licensing sits within the Single Supervisory Mechanism (SSM), the system of joint banking supervision by the ECB and national authorities. The Bank of Lithuania receives and assesses the application with the ECB, and the ECB grants the licence on the Bank of Lithuania's proposal under Regulation (EU) No 1024/2013 and the SSM Framework Regulation (Regulation (EU) No 468/2014). Providing banking services without a licence is prohibited.
Lithuanian law has allowed specialised banks since 2017. The licence was designed as a lower-capital entry point for new banks, particularly digital banks and lenders, and several of Lithuania's current banks started with it.
Both licences follow the same authorisation process, requirements and supervision. The difference is the range of services and the minimum capital.
| Point | Specialised bank | Full bank |
|---|---|---|
| Minimum initial capital | EUR 1 million | EUR 5 million |
| Deposits and lending | Yes | Yes |
| Payment services and e-money | Yes | Yes |
| Investment services | No | Yes |
| Permitted activities | Listed exhaustively in Law on Banks, Article 4(5) | All financial services unless restricted by law |
| Licence granted by | ECB, on the Bank of Lithuania's proposal | ECB, on the Bank of Lithuania's proposal |
| State levy | EUR 4,157 | EUR 4,157 |
The Bank of Lithuania notes that the capital requirement may be higher than the minimum, depending on the bank's planned activities. A specialised bank can later apply to change its licence into a full banking licence; the ECB did this for Revolut in December 2021, three years after it received a specialised bank licence.
The permitted activities of a specialised bank are set out exhaustively in Article 4(5) of the Law on Banks. They cover the core of retail and business banking:
Investment services, such as brokerage, portfolio management and safekeeping of financial instruments, are excluded. A bank that plans to offer investment products needs a full licence.
A firm that only needs to hold and move customer funds, without lending them, will usually reach the market faster with an EMI or payment institution licence. The firm's guide to the Lithuanian EMI licence and guide to the Lithuanian payment institution licence cover those routes.
| Point | Lithuanian EMI | Lithuanian specialised bank |
|---|---|---|
| Minimum initial capital | EUR 350,000 | EUR 1 million |
| Customer funds | Safeguarded, not lent | Deposits, which the bank may lend |
| Interest to customers | Not permitted on e-money | Permitted on deposits |
| Deposit guarantee | No | Up to EUR 100,000 per depositor |
| Licence granted by | Bank of Lithuania | ECB, on the Bank of Lithuania's proposal |
| Statutory decision period | 3 months | 6 months, at most 12 months |
| Prudential rules | E-money own funds rules | EU Capital Requirements Regulation |
| State levy | EUR 1,463 | EUR 4,157 |
Many founders start with an EMI, prove the model and then apply for a specialised bank licence once deposit funding and lending make commercial sense.
Initial capital of EUR 1 million for a specialised bank or EUR 5 million for a full bank must be paid up before the licence is granted. This is the entry minimum. Once licensed, the bank is subject to the EU Capital Requirements Regulation (Regulation (EU) No 575/2013, as amended), which applies on a continuing basis. The CRR was amended by Regulation (EU) 2024/1623, the EU's implementation of the final Basel III standards, which has applied in most respects since 1 January 2025.
| Requirement | Minimum | Source |
|---|---|---|
| Common Equity Tier 1 ratio | 4.5% of risk-weighted assets | CRR, Article 92 |
| Tier 1 ratio | 6% of risk-weighted assets | CRR, Article 92 |
| Total capital ratio | 8% of risk-weighted assets | CRR, Article 92 |
| Liquidity coverage ratio | 100% | CRR, Article 412, and Delegated Regulation (EU) 2015/61 |
| Net stable funding ratio | 100% | CRR, Article 428b |
On top of these minimums the bank holds the combined capital buffers set under the Capital Requirements Directive (Directive 2013/36/EU) and any additional requirement set by the supervisor after its annual review. In practice a new bank's capital plan needs capital well above the EUR 1 million entry figure to fund its first years of lending growth and losses before it reaches profit.
Every holder of a qualifying holding must have an impeccable reputation, be financially sound and show a transparent source of funds. Where there are no qualifying holders, the assessment covers the 20 founders who together hold most of the capital or voting rights.
Board members and senior managers must have an impeccable reputation and the qualifications and experience for their roles. At least one head of administration must speak Lithuanian. The Bank of Lithuania publishes an indicative minimum structure, which it states is guidance rather than a legal requirement.
| Role or body | Indicative minimum |
|---|---|
| Management board | At least 3 members, including the Chief Risk Officer and Chief Financial Officer |
| Supervisory board | At least 3 members |
| Head of administration and deputy | The chair of the management board is one of them |
| Head of internal audit | An independent person is recommended |
| Chief Technical Officer and Chief Legal Officer | Recommended to sit outside both boards |
| Audit and risk committees | Supervisory board members |
| Credit committee | Management board members may serve |
The numbers rise with the bank's complexity, scale and geographic reach. An MLRO and compliance officer are also needed for the anti-money laundering framework.
The DORA requirements for banks are covered in the firm's briefing on digital operational resilience.
The full list is in the Annex to the Rules for Licensing of Bank Activities (Bank of Lithuania Resolution No 03-196 of 22 December 2016), and submissions must also follow Resolution No 58 on applications for authorisation. The file typically covers the following.
| Document | What it shows |
|---|---|
| Business plan and financial forecasts | Products, customers, balance sheet growth, capital and liquidity over at least three years |
| Capital plan and stress tests | Capital and liquidity ratios under base and adverse scenarios |
| Articles of association and governance | Boards, committees, responsibilities and reporting lines |
| Shareholder information | Ownership chain, reputation, financial soundness and source of funds |
| Management fitness | Reputation, qualifications and experience of each board member and key function holder |
| Risk management and internal control | Policies for each risk type, internal audit and compliance |
| IT, security and outsourcing | Systems, DORA framework and material providers |
| Anti-money laundering framework | Risk assessment, customer due diligence, monitoring and reporting |
| Recovery and exit planning | How the bank would restore its position or wind down in an orderly way |
Article 9(11) of the Law on Banks requires a decision within 6 months of receiving the application. Where documents are missing or deficient, the 6 months run from receipt of the additional information, and in any case the decision must be taken within 12 months of the application. The Bank of Lithuania describes the authorisation process as taking roughly a year.
| Stage | Typical duration | Basis |
|---|---|---|
| Ex-ante evaluation and drafting | Several months | Depends on the applicant's readiness |
| Completeness check | 5 business days | Bank of Lithuania |
| Statutory decision period | 6 months, at most 12 | Law on Banks, Article 9(11) |
| Overall authorisation process | Roughly a year | Bank of Lithuania |
The state levy is EUR 4,157 for a banking licence, including a specialised licence, paid to the State Tax Inspectorate before applying; a further EUR 149 applies if the group must be entered in the public list of financial conglomerate undertakings. The larger costs are the capital itself, the management team, core banking technology, audit and deposit guarantee contributions.
A licensed Lithuanian bank, including a specialised bank, joins the national deposit insurance scheme, which protects each depositor up to EUR 100,000 under the EU Deposit Guarantee Schemes Directive. The bank pays contributions to the scheme based on its covered deposits and risk profile.
Lithuanian banks can join CENTROlink, the Bank of Lithuania's payment system, for SEPA credit transfers, SEPA Instant and direct debits. A licensed bank can also passport its permitted services across the European Economic Area under the Capital Requirements Directive, by branch or cross-border services, after notification through the Bank of Lithuania. The firm's banking and payment processing service arranges the correspondent and scheme relationships a new bank needs.
Buying an existing Lithuanian bank requires approval of the new qualifying holders, decided by the ECB on the Bank of Lithuania's proposal. The Bank of Lithuania recommends an ex-ante assessment before such an acquisition. The firm's transactions and change of control service manages that approval.
EUR 5 million for a full bank and EUR 1 million for a specialised bank. The Bank of Lithuania may require more depending on the planned activities.
It cannot provide investment services such as brokerage or portfolio management. Its permitted activities are listed exhaustively in Article 4(5) of the Law on Banks.
The ECB grants the licence on the proposal of the Bank of Lithuania, after a joint assessment of the application.
The Law on Banks requires a decision within 6 months of the application, and at most 12 months. The Bank of Lithuania describes the process as taking roughly a year.
EUR 4,157, paid to the State Tax Inspectorate before applying, for both full and specialised bank licences.
Yes. Deposits are covered by the Lithuanian deposit insurance scheme up to EUR 100,000 per depositor.
Yes. The bank can apply to change its licence to a full banking licence, which the ECB grants on the Bank of Lithuania's proposal.
At least one head of administration must speak Lithuanian. The Bank of Lithuania lists this among its requirements for bank management.
Buckingham Capital Consulting has obtained e-money and payment authorisations for firms including Dzing Finance, Hryze and Nexpay since 2013, and supports founders planning the step from an EMI to a specialised bank licence in Lithuania. The firm prepares the business plan, capital plan, governance and anti-money laundering frameworks for the joint Bank of Lithuania and ECB assessment, and arranges the banking and payment relationships the new bank needs.
Speak to an expert: WhatsApp +44 7563 115980, Telegram @buckinghamcapital or info@buckinghamcapitalconsulting.co.uk.
This article is general information, reviewed against the regulator’s published requirements on the date shown. It is not legal advice; the regulator’s current publications take precedence.