Financial Crime World

Regulatory Environment for Online Lending, Payment Processors, and Fund Administrators in Slovenia

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Slovenia has a well-established regulatory framework that governs various aspects of online lending, payment processing, and fund administration. This article provides an overview of the key regulations and requirements in these sectors.

Consumer Protection

Licensing Requirements for Online Lenders

  • Online lenders must obtain a license before providing consumer credit services.
  • Creditors must comply with regulations regarding consumer credit, just like other loan providers.

Underwriting Process

  • The underwriting process involves assessing the creditworthiness of consumers based on relevant income and expenditure information.
  • Databases like SISBON (System for Exchanging Information on the Indebtedness of Consumers) are crucial in managing credit risk and preventing over-indebtedness.

Sources of Funds

Main Source of Funding

  • Online lenders in Slovenia primarily use lender-raised funds and deposits as their main source of funding.
  • The further development of online lending is expected to introduce securitisation and peer-to-peer lending into the market.

Syndication of Loans

Current State of Loan Syndication

  • As per the information, online loan syndication is not yet present in Slovenia.

Payment Processors

Implementation of New Payment Rails

  • Payment processors can either use existing payment rails or create new ones based on their strategic objectives, technological capabilities, and market dynamics.
  • The implementation of new payment rails must comply with relevant regulations and licensing requirements.

Regulation of Cross-Border Payments and Remittances

Regulations for Cross-Border Payments

  • Cross-border payments are governed by regulations like the Cross-Border Payments Regulation (CBPR) to ensure uniform charges across EU countries.
  • The SEPA Regulation enables euro-denominated payments within the EU under standardized conditions.

Fund Administrators

Regulatory Frameworks

  • Fund administrators of both UCITS and AIFs are regulated, with distinct regulatory frameworks for each type of fund.
  • An AIF administrator must obtain a license from the Securities Market Agency (ATVP) to provide administrative services.
  • Fund administrators must establish sound management systems, prevent conflicts of interest, and adequately manage risks.

Contractual Terms

  • Contractual terms between fund advisers and administrators are subject to industry custom and general contract law principles.
  • Service agreements typically set out the rights and obligations of both parties in detail.