On January 20, the Luxembourg Financial Sector Supervisory Commission (CSSF) issued Circular CSSF 26/906 to tighten regulations for payment and electronic money providers. This new framework aims to prevent consumer confusion by prohibiting non-banking entities from using terms like "bank," "neo-bank," or "bank accounts" in their marketing. The circular mandates that firms maintain a physical decision-making center in Luxembourg rather than just a registered office. It introduces rigorous governance standards, including a formal three-lines-of-defence approach and a mandatory New Product Approval Process. Furthermore, firms must implement strict safeguarding and reconciliation protocols for customer funds, with daily reconciliations required for complex operations. These regulations apply to Luxembourg-headquartered firms and their branches, with a strict compliance deadline set for June 30, 2026. The initiative seeks to ensure that rapid industry growth is matched by robust internal controls and accountability.