SCA license categories are classifications that determine the level of authorization a business needs to process online payments securely. SCA regulation introduced three main license categories: Payment Service Providers (PSPs), Account Information Service Providers (AISPs), and Payment Initiation Service Providers (PISPs). Each of these categories plays an important role in the payment ecosystem and has its own set of requirements and responsibilities.
Navigating the detailed landscape of virtual assets and financial regulations is no easy task. For businesses operating in the digital and crypto space, obtaining approvals from regulatory authorities like the Securities and Commodities Authority (SCA) is required. These approvals not only ensure compliance but also establish credibility and trustworthiness in the market. Neeja Corporate Services is your trusted partner in securing these SCA-related approvals, providing specialized services that cater to various types of virtual asset activities and financial services.
Categories of Virtual Assets and Services Subject to SCA Approval
The virtual asset ecosystem is vast, encompassing a range of activities that are subject to regulatory oversight. To ensure legal compliance and operational integrity, businesses in this space must obtain licenses and approvals from the SCA. Some of the key virtual asset activities that require SCA approval include:
1. Virtual Asset Exchange Platforms:
These platforms facilitate the buying, selling, or exchanging of virtual assets such as cryptocurrencies. Securing an SCA license categories that your platform adheres to standards of transparency, security, and user protection.
2. Virtual Wallet Services:
Providers offering wallets for the storage and management of virtual assets are subject to strict SCA guidelines. These wallets must comply with encryption and security protocols to safeguard client assets.
3. Financial Services Related to Virtual Assets:
Companies offering financial services tied to virtual assets, including investment management, advisory services, or trading, require SCA authorization. This includes complying with risk management procedures and ensuring market transparency.
4. Custodial Services:
Custodial services involve the safekeeping of virtual assets on behalf of clients. The SCA places specific requirements on these service providers to ensure that assets are adequately protected against theft, fraud, or loss.
5. Initial Coin Offerings (ICOs):
If your business is looking to raise capital through an ICO, obtaining approval from the SCA is mandatory. Neeja Corporate Services can guide you through the complex process of preparing your ICO to meet all regulatory requirements.
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What are SCA License Categories in UAE?
SCA license categories refer to the different types of licenses that businesses must obtain to operate in compliance with Strong Customer Authentication regulations. These categories are typically based on the level of risk associated with the services provided by the business. The main SCA license categories are:
- Payment Initiation Service Providers (PISP): These entities are authorized to initiate payment transactions on behalf of customers. PISPs play a crucial role in facilitating online payments and minimizing the risk of fraud.
- Account Information Service Providers (AISP): AISPs are authorized to access and aggregate financial information from multiple accounts. This allows customers to have a comprehensive view of their finances and make informed decisions about their money management.
- Payment Service Providers (PSP): PSPs are entities that provide payment services to consumers and merchants. They act as intermediaries between banks, customers, and merchants to facilitate secure and efficient transactions.
| Financial Activities & License categories |
|---|
| Trading broker. |
| Trading and clearing broker. |
| Trading broker in the international markets. |
| Trading broker of OTC derivatives and currencies in the spot market. |
| Securities dealer. |
| Financial Consultations. |
| Financial advisor (issuance manager). |
| Listing advisor. |
| Promotion. |
| Definition. |
| General clearing. |
| Securities portfolios management. |
| Investment funds foundation and management (the management company). |
| Management of investment fundsʹ investments. |
| Administrative services of investment funds. |
| Safe Custody. |
| Registrar of private joint stock companies. |
| Issuer of covered warrants. |
| Deposit bank. |
| Deposit bankʹs agent. |
| Credit rating. |
Types of SCA Approvals and Licenses
When operating in the virtual asset space, different types of licenses and approvals are required, depending on the nature of your business. At Neeja Corporate Services, we offer specialized consultancy for each of these categories, ensuring that your business secures the correct license for its operations:
1. License for Virtual Asset Exchanges:
This is required for businesses operating exchanges where virtual assets are traded. The SCA ensures that these exchanges maintain liquidity, uphold transaction transparency, and implement proper anti-fraud measures.
2. License for Virtual Asset Service Providers (VASPs):
Virtual asset service providers, which include brokers, dealers, or other intermediaries, must obtain this license. It covers a range of activities such as exchange services, custody, and transfers of virtual assets.
3. Custody Provider License:
Businesses offering storage solutions for virtual assets are required to have a custody provider license. This ensures that the company meets the SCA’s stringent security and governance standards for safeguarding digital assets.
4. SCA Approval for ICOs and Token Sales:
Any business intending to launch an ICO must first secure approval from the SCA. This includes disclosing all relevant details about the token, its underlying value, and the risk factors involved.
5. Financial Services License for Virtual Asset Management:
This license is crucial for businesses offering portfolio management or advisory services related to virtual assets. The SCA mandates strict adherence to risk management, client disclosure, and data protection protocols.
Lists of SCA License Categories
| Categories | Licenses |
|---|---|
| First Category | Dealing in securities. |
| Second Category | Dealing in investment. |
| Thrid Category | Third Category |
| Fourth Category | Credit rating agencies. |
| Fifth Category | Arrangement and advice. |
Why Choose Neeja Corporate Services?
1. Comprehensive Knowledge of SCA Regulations:
At Neeja Corporate Services, we pride ourselves on our in-depth understanding of SCA regulations. From crypto exchanges to wallet services and ICOs, our experts are equipped to guide your business through every step of the approval process.
2. End-to-End Support for License Applications:
Navigating the regulatory landscape can be overwhelming, but Neeja Corporate Services simplifies the process by offering end-to-end support. We handle everything from documentation preparation to liaising with the SCA on your behalf, ensuring that your application proceeds smoothly and efficiently.
3. Customized Solutions for Your Business Needs:
We understand that no two businesses are alike. That’s why we offer tailored solutions based on your unique requirements, ensuring that you obtain the appropriate approvals for your specific virtual asset activities.
4. Focus on Compliance and Risk Management:
Compliance with SCA regulations is not just about securing a license—it’s about protecting your business from potential risks. Neeja Corporate Services ensures that your company adheres to all regulatory guidelines, helping you avoid penalties, fines, or reputational damage.
5. Commitment to Security and Transparency:
In a market where trust is paramount, we help you implement robust security measures, such as wallet encryption and transaction monitoring, to meet the SCA’s security standards. This builds trust with your clients, ensuring that your business operates transparently and ethically.
In conclusion, understanding the SCA license categories is essential for navigating the complex world of payment processing. By familiarizing yourself with the different license categories and their requirements, you can ensure that your business is compliant with the SCA regulations and provide your customers with a secure and seamless payment experience.
At Neeja Corporate Services, we are dedicated to helping your business navigate the complex regulatory environment, ensuring that you meet all the requirements to operate legally and successfully in the virtual asset space. Whether you’re seeking approval for an exchange platform, wallet service, or ICO, our team of experts is here to guide you through the process with confidence.
Connect with Neeja Corporate Services
Are you looking to start your company in Dubai but feeling overcome by the registration process? Don’t worry, you’re not alone. Setting up a business in a foreign country can be challenging, but with the right guidance and support, it doesn’t have to be a stressful experience. Neeja’s business setup services offer complete support and serve as a one-stop shop for company setup in Dubai. We provide a wide range of value-added services, such as SCA License Categories. Over the years, we have successfully advised many new entrepreneurs to make their business dreams a reality.
To book a free consultation, call on +971 43243031. You can also send a WhatsApp message at +971 50 465 2843. To connect over email, send us your query at incorp@neejacs.com.
