FitPhase 1
Does your product fit the exclusion?
We analyze the instrument against the three cases in Article 4(k) of Royal Decree-law 19/2018 and the guidelines of the European Banking Authority.
The starting question.
Limited network exclusion (PSD2) for payment services
Gift cards, store cards, in-house wallets or vouchers can fall outside payment services rules thanks to the limited network exclusion. We analyze whether your product fits, prepare the notification to the Bank of Spain when you exceed €1 million and, if it does not fit, tell you which license you need.
Does your product need a license? Free analysis
Tell us how your card or wallet works and we will tell you whether it can qualify for the exclusion.
- Reply within 24 h
- No commitment
- Confidential
- Bank of Spain notification threshold
- €1 million
- Legal basis for the exclusion
- Art. 4(k)
- Exclusion cases
- 3 cases
- EBA Guidelines
- EBA/GL/2022/02
How we help
Your product, inside or outside payment services rules
The limited network exclusion means you do not have to apply for a payment institution or electronic money institution license, but only if the product meets its conditions. We help you check this, document it and notify it.
NetworkPhase 2
Network of service providers and contracts
We review the merchant network and the direct commercial agreements with the issuer, which are the key to a limited network.
No direct agreement, no network.
RangePhase 3
Range of goods or services
If the product is based on a very limited range of goods or services, we check that they have the functional connection the guidelines require.
A functional connection, not a list.
ThresholdPhase 4
Monitoring the €1 million threshold
We help you measure the value of payment transactions over the last 12 months, which is what triggers the duty to notify.
A threshold to keep an eye on.
NotificationPhase 5
Notification to the Bank of Spain
We prepare the notification with a description of the services and the applicable exclusion, and we handle any requests for information.
Documented from the start.
Plan BPhase 6
If it does not fit: redesign or license
If the product does not meet the exclusion, we propose how to redesign it or support you through the payment institution or electronic money institution license.
No operating in a gray area.
Scenarios
When the exclusion can apply
The exclusion does not depend on what you call the product, but on where it can be used and for what.
Issuer’s premises
Only usable in your own stores
Instruments that only allow purchases at the issuer’s premises, such as a gift card that can only be used in the stores of the company that issues it.
Limited network
Usable across a network of merchants
Instruments used within a limited network of service providers linked to the issuer by a direct commercial agreement.
Very limited range
Usable for one type of product
Instruments that only allow the purchase of a very limited range of goods or services that are functionally connected.
Social or tax purposes
Promoted by a company or a public body
Instruments valid at national level and regulated by a public authority for social or tax purposes, used to buy from suppliers that have an agreement with the issuer.
What the law requires
The limited network exclusion in figures
Data from Royal Decree-law 19/2018 on payment services and from Guidelines EBA/GL/2022/02 on the limited network exclusion.
RDL 19/2018 Art. 4(k)
3 cases
Issuer’s premises or limited network, very limited range of goods or services, and social or tax purposes.
Threshold
€1 million in 12 months
If the total value of transactions exceeds €1 million over the previous 12 months, you must notify the Bank of Spain.
Decision
Reasoned
If the activity does not meet the criteria, the Bank of Spain adopts a reasoned decision and informs the party concerned.
Telecommunications
€50 / €300
Under the electronic communications exclusion, no single transaction may exceed €50 and a subscriber’s cumulative total may not exceed €300 a month.
Telecommunications
Annual report
Anyone relying on that exclusion must notify the Bank of Spain every year, in the first quarter, with a report from an independent expert.
EBA Guidelines
2022 and 2023
The Bank of Spain adopted Guidelines EBA/GL/2022/02 in July 2022, except Guidelines 1.7 and 6.2; it adopted the latter in June 2023.
Can your product stay outside payment services rules?
We analyze your card, wallet or voucher and tell you whether it fits the exclusion, what you need to notify and what to do if it does not fit.
Frequently asked questions
Limited network exclusion: common questions
What is the limited network exclusion?
It is an exclusion in Royal Decree-law 19/2018 that places outside payment services rules those instruments that can only be used in a limited way: at the issuer’s premises or within a limited network of service providers that have a direct commercial agreement with the issuer, for a very limited range of goods or services, or for social or tax purposes regulated by a public authority (Article 4(k)).
Which products can qualify?
In its Recital 14, Directive (EU) 2015/2366 (PSD2) mentions store cards, fuel cards, membership cards, public transport cards, parking tickets, meal vouchers or vouchers for specific services. But the key is not what the product is called; it is whether it meets the criteria of the exclusion.
When do you have to notify the Bank of Spain?
When, relying on the issuer’s premises or limited network case or on the very limited range case, you have executed payment transactions with a total value of more than €1 million over the previous 12 months (Article 6(1)). The notification describes the services and states which exclusion you consider the activity falls under.
What does the Bank of Spain do with the notification?
If it considers that the activity does not meet the criteria, it adopts a reasoned decision and informs you. It also informs the European Banking Authority of the notified activities, and their description is published in the Bank of Spain register.
What criteria does the European Banking Authority use?
Guidelines EBA/GL/2022/02 set out, among other things, what agreements must exist between the issuer and the service providers in the network, how to assess whether the network is limited and when there is a functional connection that allows a range of goods or services to be treated as very limited. The Bank of Spain has adopted them with exceptions.
What if my product can be used to buy almost anything?
Then it does not fit: the exclusion requires limited use. If the instrument allows payments across a broad network or for a broad range of products, you will be providing a payment service, which only authorized providers may provide on a professional basis (Article 5), and you will need a payment institution or electronic money institution license.
Is there a similar exclusion for telecom operators?
Yes, the one in Article 4(l): payments charged to an operator’s bill for digital content and voice-based services, charitable activities or travel and event tickets, provided that no single transaction exceeds €50 and a subscriber’s cumulative total does not exceed €300 a month. Anyone relying on it must notify the Bank of Spain every year, with a report from an independent expert.
How is the notification filed?
Through the Bank of Spain’s electronic office, using the form provided for limited network exclusions and an electronic signature. The Bank of Spain may request additional information before registering the exclusion.
Practical guide
How to check whether your product is excluded
The exclusion is analyzed product by product. Documenting your reasoning properly protects you before the Bank of Spain and with your commercial and banking partners.
Describe how the instrument is used
Where it is accepted, who issues it, what can be bought with it, who tops it up and with what limits: that description drives the analysis.
Contracts with the network
In a limited network, the direct commercial agreement between the issuer and the service providers is what sets the exclusion apart from a payment service.
Watch the volume
Measure the value of transactions over the last 12 months: once it exceeds €1 million, you must notify.
The limited network exclusion in 10 steps
- Describe the instrument: who issues it, where it is accepted, what can be bought with it and how it is loaded.
- Identify which Article 4(k) case could apply: issuer’s premises or limited network, very limited range, or social or tax purposes.
- Review the commercial agreements between the issuer and the service providers in the network.
- If you rely on a very limited range, check the functional connection between the goods or services.
- Check the design against Guidelines EBA/GL/2022/02, as adopted by the Bank of Spain.
- Measure the value of payment transactions over the last 12 months.
- If it exceeds €1 million, prepare the notification with a description of the services and the applicable exclusion.
- File it through the Bank of Spain’s electronic office and respond to its requests for information.
- Review the analysis every time you expand the network, the products or the uses of the instrument.
- If it does not fit, redesign the product or apply for a payment institution or electronic money institution license.
Sources: Royal Decree-law 19/2018 (Articles 4, 5 and 6), Guidelines EBA/GL/2022/02 and the Bank of Spain’s electronic office.
Working glossary
Key concepts of the limited network exclusion
These terms come up in the product analysis and in the notification to the Bank of Spain.
RDL 19/2018Spanish law
Royal Decree-law on payment services
The law that transposes PSD2 in Spain and regulates the exclusions from its scope.
Legal basis for the exclusion.
PSD2EU directive
Directive (EU) 2015/2366
The EU Payment Services Directive, where the limited network exclusion comes from.
Its Recital 14 gives examples.
Limited networkArt. 4(k)(1)
Limited network of service providers
Merchants that accept the instrument under a direct commercial agreement with the issuer.
Direct agreement.
Very limited rangeArt. 4(k)(2)
Very limited range of goods or services
Goods or services that have a functional connection with each other.
Functional connection.
ThresholdArt. 6(1)
Notification threshold
Transactions worth more than €1 million over the previous 12 months.
Triggers the duty to notify.
EBA GuidelinesEBA/GL/2022/02
Guidelines on the limited network exclusion
European criteria for interpreting the exclusion, adopted by the Bank of Spain with exceptions.
Interpretive guidance.
Reserved activityArt. 5
Reserved activity
Only authorized providers may provide payment services on a professional basis.
No exclusion means a license.
Payment institutionLicense
Payment institution
A provider authorized by the Bank of Spain to provide payment services.
The alternative if it does not fit.
EMILicense
Electronic money institution
An institution authorized to issue electronic money and provide payment services.
Another alternative.
Playbook
Limited network or very limited range: what each one requires
Legal basis
Limited network: Article 4(k)(1) of RDL 19/2018.
Very limited range: Article 4(k)(2) of RDL 19/2018.
What it limits
Limited network: where it can be used: the issuer’s premises or a network of service providers.
Very limited range: what can be bought: a very limited range of goods or services.
Key to the analysis
Limited network: a direct commercial agreement between the issuer and the service providers.
Very limited range: a functional connection between the goods or services.
Notification
Limited network: if it exceeds €1 million in 12 months.
Very limited range: if it exceeds €1 million in 12 months.
Typical risk
Limited network: expanding the network until it is no longer limited.
Very limited range: expanding the catalog until it is no longer very limited.
Mistakes that turn the exclusion into a problem
A wrongly applied exclusion means providing payment services without a license.
- Assuming a product is excluded because it is called a gift card.
- Expanding the merchant network without reviewing the agreements with the issuer.
- Not measuring transaction volume and exceeding €1 million without notifying.
- Not documenting the reasoning that justifies the exclusion.
- Not reviewing the analysis when the business model changes.
Contact
Book a call
Tell us how your card, wallet or voucher works and where it is used, and we will tell you whether it fits the exclusion and what you must notify.
The limited network exclusion in payment services law
Royal Decree-law 19/2018 on payment services, which transposes Directive (EU) 2015/2366 (PSD2), reserves the provision of payment services to authorized providers. However, its Article 4 excludes certain activities. One of the most widely used is the limited network exclusion, designed for instruments that can only be used in a limited way.
The three cases in Article 4(k)
The exclusion covers services based on specific payment instruments with limited use that allow goods or services to be bought only at the issuer’s premises or within a limited network of service providers under a direct commercial agreement with a professional issuer; instruments that can only be used for a very limited range of goods or services; and instruments valid at national level and regulated by a public authority for social or tax purposes.
Notification to the Bank of Spain
If over the previous 12 months you have executed transactions worth more than €1 million under the first two cases, you must notify the Bank of Spain, describing the services and the applicable exclusion. If the activity does not meet the criteria, the Bank of Spain adopts a reasoned decision. Notified activities are reported to the European Banking Authority and their description is published in the register.
European criteria
Guidelines EBA/GL/2022/02 specify how to interpret the exclusion: what a limited network is, when a range is very limited and how to notify. The Bank of Spain adopted them in July 2022 with exceptions, and in June 2023 it also adopted Guideline 6.2.
If the exclusion does not apply
Providing payment services without being an authorized provider breaches the reserved activity rule in Article 5. In that case, the alternatives are to redesign the product or to apply for a payment institution license or an electronic money license. To learn more, see our pages on PSD2 and on providing services without a license.
Official sources
Key legislation, linked to the official text:
- Royal Decree-law 19/2018 of November 23 on payment services and other urgent financial measuresBOE · consolidated text
- Directive (EU) 2015/2366 of November 25, 2015 on payment services in the internal market (PSD2)EUR-Lex · Official Journal of the EU
Legislation and links reviewed in .