Mauritius – An Emerging Hub for Fintech & Payment Solutions in Africa
In the past decade, Mauritius has emerged as a strategic location for a variety of financial services in Africa. Under the guidance of the Mauritius Financial Services Commission (FSC), a robust framework now exists for the regulation of derivatives activities, payment & banking services, as well as digital asset / virtual currency projects.
Payment Services for Africa & The Globe
Starting off with payment services, Mauritius offers two distinct licenses: Payment Intermediary Services (PIS) and Payment Service Provider (PSP). There are major differences between these licenses which are worth delving into greater detail.
The major distinction between the PIS and PSP license is that the former is overseen by the Mauritius FSC while the Bank of Mauritius issues all PSP licenses. From our professional experience, the PIS license is more attractive due to lower capital requirements (2,000,000 MUR), a speedier license approval period as well as lower substance requirements. Furthermore, the PIS license is a better fit for cross-border payment services with the PSP license being issued primarily for local business in Mauritius itself. Finally, the Payment Intermediary Services license focuses primarily on card issuance services. Experience has shown that higher demand exists for card and mobile payment services throughout Africa, making the PIS license a better fit for the majority of new payment projects.
Derivatives & Virtual Currency
Moving on to exchange traded products, Mauritius has two distinct regulatory paths for brokers and digital asset providers / crypto exchanges. On the brokerage side, the FSC has a unique license class for brokerage services, known as an Investment Dealer. This license allows one to offer brokerage services in derivatives, stocks, and futures which can be used to target a global audience. An additional benefit of the Investment Dealer license is the underwriting permission. By upgrading the Investment Dealer license to this permission set, licensed brokerage firms in Mauritius will have the ability to initiate stock listings on the Mauritius public stock exchange.
In addition to derivatives regulation, Mauritius also for the establishment of fully regulated digital asset firms. VAITOS 2021, which is the regulatory framework for crypto licensing in Mauritius, sets the standard for Virtual Asset Service Provider (VASP) regulation. Licensed activities include: exchange permissions, wallet services, custodian of tokens, and exchange services.
Investment Banking Activities
Finally, the Mauritius FSC also provides a clear pathway for the establishment of an Investment Banking license. A key advantage is flexibility as a variety of financial activities are permitted under this license. Examples of permitted activities include: merger & acquisition advisory, asset management, securities dealing, the underwriting of securities, as well as corporate finance. It is important to highlight that receiving deposits and other types of banking activities do require separate authorisation from the Bank of Mauritius, making a clear distinction between investment and commercial banking activities.
In addition to this level of flexibility, Mauritius offers two major incentives to firms looking to establish a presence on the island. First, Mauritius currently has 46 Double Tax Agreements with a variety of countries around the world, examples include China, South Africa, UK and France. Additionally, any new investment bank will enjoy a 5 year tax holiday from the standard 15% corporate tax rate.
Discover the Benefits of Mauritius Regulation Today!
As interest in mobile payment services and digital assets continues to grow throughout Africa and the world, Mauritius will remain the ideal jurisdiction for the quick and efficient regulation of these emerging financial services. We hope this brief overview was useful in providing a basic introduction to Mauritius.
For many businesses, it strikes the right balance between innovation and compliance.
At MNL Advocates LLP, we work closely with fintech companies, financial institutions, and investors to navigate complex regulatory landscapes across Africa and offshore jurisdictions such as Mauritius.
Our support includes:
- Advising on the most suitable licensing structures (PIS, PSP, VASP, Investment Dealer, Investment Banking)
- Managing end-to-end license applications and regulatory engagement
- Structuring cross-border operations and corporate entities
- Drafting compliance frameworks and internal policies
- Providing ongoing legal and regulatory support
- Acquisition of a fully licensed Investment Dealer or VASP firm.
Whether you are launching a fintech startup or expanding an existing operation, our team is well-positioned to guide you through every stage of the process.
Have questions or exploring Mauritius as your next hub? Get in touch with MNL ADVOCATES LLP to start the conversation.
