A payments business has to answer one question before it builds anything in the Gelephu Mindfulness City: is the money it will hold a deposit, a payment account balance or stored value? The answer decides which licence it needs. Basnet Law Pte. Ltd., the first law firm incorporated in the Gelephu Mindfulness City, advises payment, remittance, wallet and e-money businesses on the Financial Services Act 2025 and deals with the Gelephu Financial Services Office for them. This page explains how the Providing Money Services activity works and how we take you to a licence.
How we help
- Classifying every customer money flow as a deposit, a payment account, stored value or money remittance.
- Testing each function against the Money Services exclusions, including the technical-service-provider and limited-network safe harbours.
- Advising on whether a fiat-referenced token layer adds a separate issuance activity to the payments licence.
- Preparing the business model presentation, the regulatory business plan and the compliance file GFSO assesses.
- Filing the licence application and the Approved Person applications for the mandatory Controlled Functions.
- Running the In-Principle Approval conditions: incorporation, the GMC bank account, capital injection, office and key hires.
- Designing client money arrangements and reviewing wallet apps and merchant onboarding material against the financial promotions restriction.
How money services licensing works in GMC, in plain terms
The Financial Services Act 2025 has applied in GMC since 26 December 2024, and the Gelephu Financial Services Office is the single regulator for financial services and virtual asset activities. No person may carry on a regulated activity by way of business in GMC unless it is a Licensed Firm or an Exempt Firm. A person acts by way of business if the activity itself amounts to carrying on a business, if it holds itself out as willing and able to engage in it, or if it regularly solicits others to transact, so advertising a wallet before any transaction has been processed is enough.
Providing Money Services is one of the activities the Act specifies. It means providing currency exchange, money remittance or payment services. Payment services cover operating a payment account, executing payment transactions, issuing payment instruments, selling or issuing stored value, receiving money for transmission, and transferring, settling or safeguarding fiat-referenced tokens for payment purposes. Stored value is electronically stored monetary value represented by a claim on its issuer and accepted by persons other than the issuer: the e-money concept. Money remittance is receiving money for remittance without a payment account, instrument, token or stored value.
The boundary with banking matters. A customer balance repayable on demand is a deposit, but accepting deposits is regulated as banking only where the money is lent to others or finances the firm's other activities. A balance held solely to execute the customer's payment instructions is a payment account; a prepaid balance redeemable at third-party merchants is stored value. Money received by a licensed money services firm in the course of that activity is not a deposit and is handled under the Client Money Rules. The Act also lists what is not a payment service, including cash-only transactions, settlement-system transactions between payment providers and banks, technical service providers that never possess the funds, limited-network instruments, intra-group payments and the issuance of a fiat-referenced token. A Licensed Firm is also excused from the money services activity where it is a necessary part of another regulated activity.
Issuing a fiat-referenced token is its own activity, but transferring or settling the token for payments, or operating a payment account that holds it, is a payment service. Algorithmic stablecoin tokens and privacy tokens are barred from any regulated activity.
The licence follows GFSO's published seven-step process, from an initial meeting and business model presentation through review to In-Principle Approval with pre-conditions and, once those are met, issue of the licence. Only a body corporate or a partnership may apply, and a GMC-incorporated licensee must keep its head and registered office in GMC. Every applicant must show adequate resources, fitness and propriety, capacity to be supervised and adequate compliance arrangements, and must appoint a Senior Executive Officer, a Compliance Officer and an MLRO resident in GMC or Bhutan, with residence waivable for the latter two. Fees, capital figures and processing times are set by GFSO and the prudential rulebook, not the Act, and GFSO decides whether a licence is granted.
Who this is for
- Payment institutions and merchant acquirers establishing a GMC entity.
- Remittance operators and currency exchange businesses serving Gelephu's workforce and visitors.
- Wallet and e-money issuers whose balances are held to make payments rather than to fund lending.
- Stablecoin projects that also want to run the payment layer on their own token.
- Firms already licensed in Singapore, Abu Dhabi Global Market or Hong Kong considering the May 2026 fast-track pathway.
How an engagement runs
- Perimeter analysis. We map each product to the money services definitions, the deposit test and the exclusions, and tell you which activities need a licence.
- Business model and file. We prepare the presentation for the initial GFSO meeting, then the business plan, governance design, AML manual and systems-and-controls documentation.
- Application. We lodge the prescribed forms, controller information and Approved Person applications, and manage interviews and information requests until GFSO decides.
- In-Principle Approval. We incorporate the applicant through GCRO, sequence the bank account and capital injection, and evidence office and personnel to GFSO until the licence issues.
- Operation. We handle client money arrangements, notifications, scope variations and change-of-control filings once the firm is live.
Frequently asked questions
Is holding customer wallet balances in GMC banking?
Only if the money is lent out or finances your other activities. A balance held solely to execute the customer's payments is a payment account or stored value within Providing Money Services.
Does a software vendor that routes payments need a licence?
A technical service provider that never comes into possession of the funds is outside the payment services definition, and closed-loop gift cards and store credit fall within the limited-network exclusion. We document reliance on each exclusion.
Can I start processing payments once I have In-Principle Approval?
No. GFSO states that In-Principle Approval does not permit the firm to conduct business in GMC. The General Prohibition applies until the licence takes effect on the date in GFSO's written notice, and a firm must not describe itself as licensed before then.
Does my foreign payments licence let me operate in GMC?
No. The fast-track pathway gives accelerated review to firms licensed in Singapore, Abu Dhabi Global Market or Hong Kong, but GMC has stated that those firms must still meet its own regulatory standards and supervision. A GMC licence is still required.
Talk to GMC counsel on the ground
Basnet Law Pte. Ltd. is the first law firm incorporated in the Gelephu Mindfulness City. A short conversation early in a matter usually saves time and cost later. Write to basnet@basnetgmc.com or office@basnetgmc.com with a few lines about your plans, and we will tell you plainly what is needed, how long it takes, and whether we are the right fit.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
