Everything you need to know about electronic money

Electronic money is defined as a monetary value stored electronically. Electronic money only exists on a technical device (cards, computers, mobile phones, etc.) and is not stored in any physical form. Electronic money can be exchanged, traded, stored and used electronically to pay and receive funds. Physical money is gradually becoming obsolete as more and more companies opt for the electronic alternative: electronic money.

What is an electronic money account?

An electronic money account is held with an electronic money institution, an electronic wallet or a payment company. With an electronic money account, you have all the services of a traditional bank account, but with certain advantages. Electronic money accounts give you fast electronic transactions; highly encrypted security; convenience; low or no cost and access anytime, anywhere. By using an e-money account, you don't need to give your credit card details every time you make a transaction because the card is linked to your e-money account.

How to open an electronic money account?

Opening an e-money account is simple and only takes a few minutes. Select a trusted e-money provider. Sign up for an electronic money account by filling out a simple online form with basic name, email and mobile phone number details. Link your bank account or credit card to your e-money account. From then on, you can make transactions just by logging in with your username and password.

What is an E-money mobile application?

An e-money mobile application is downloaded to your smartphone and used as an access point to all your accounts, anytime, anywhere. An e-money app gives you an e-wallet on your smartphone on which you can focus all of your accounts - credit cards, bank accounts, and e-money accounts. You can even send or receive funds from people who don't have an e-money mobile app using their mobile phone number or email address. With an e-money app, businesses can track their finances, perform instant mobile money transfers (MMTs), make mobile payments, access accounts through their smartphones, and be in control wherever you are. It is similar to the purchasing a money transfer app with a lot more features and additional services like currency conversion, cards, bank transfers etc.

What is an electronic wallet?

An electronic wallet stores electronic money in the same way that a conventional wallet stores money. It can also store multiple credit card and bank account information in a secure electronic environment. For businesses, adding an e-wallet payment option to your system can improve sales. Thanks to the high level of encryption on electronic wallets, your business also benefits from increased security.

Electronic money accounts and EMI accounts or conventional banking services

If you are looking for an alternative to your traditional business bank account, we can help you find the solution that best meets your banking needs.

Electronic money Institutions can issue electronic money; provide payment services; in some cases, grant loans linked to payment services; offer operational and additional services such as the management of your payment system or your commercial activity.

What is an approved payment institution?

A payment institute (often referred to as a financial institution) is a type of payment service provider created following the adoption in 2009 of the EU Payment Services Directive (PSD). The Directive established regulations for all payment service providers that would allow businesses and individuals to make secure, profitable and timely payments. By removing legal barriers to the provision of European payment services, the directive opened the market to new entrants to the European payments market, including payment institutions.

What are Payment Services Regulators and Payment Services Regulation?

Payment institutions are regulated and supervised under the same conditions as the general supervisory procedures of the Central Bank. The aim is to ensure that all financial service providers live up to their responsibilities and have strong internal controls and management. Payment institutions must also follow normal procedures and ensure that all employees, at all levels of the organization, act with integrity and competence. All authorized payment service providers, whether they operate internationally or nationally, must adhere to best practices.

In accordance with the regulations on payment services, authorized payment institutions must have a system in place to monitor compliance and reduce risks. The company's internal policies and procedures should aim to ensure regulatory compliance and reduce risk.

How is consumer protection implemented? The Supervision Division oversees the quality of internal control systems, risk management and corporate governance of payment service institutions.

How are authorized payment service institutions supervised ?

The oversight process involves multiple approaches to ensure that the payment service institute complies with regulations and maintains the high level of business practices expected of them. Actions taken by the supervision division may include:

  • Inspections, of a general nature or aimed at a specific aspect.
  • Review meetings.
  • Risk assessment.
  • Regular fit and cleanliness tests.
  • Permanent correspondence and contacts with supervised companies.
  • Analysis of declarations submitted to the central bank.

What is a business virtual bank account?

A virtual account system is complete, economical and centralizes funds. Businesses can design a network of parallel accounts (virtual accounts) for their physical bank account. Your customer receives your virtual account details, pays into the virtual account and the funds are automatically transferred to your physical bank account. You can have a unique virtual account number for each customer, business unit, or inbound and outbound transaction. This way you know where the money is coming from and yet all the funds are coming into your physical bank account. No physical movement of funds actually occurs between accounts and the entire account network is usually administered by a virtual account management (VAM) solution.

What is a virtual IBAN Business account?

With a virtual IBAN, you have unique “fictitious” international bank account numbers issued by a bank so that incoming funds can be redirected directly to your “real” IBAN account at a physical bank. A virtual IBAN allows you to conduct virtual international business transactions anywhere in the world where the funds end up in your physical bank account. As far as the customer is concerned, your bank details are like any other usual IBAN. When the customer pays into your virtual IBAN account, the funds are automatically transferred to your IBAN account at a physical banking institution, associated with the virtual account. You can have multiple virtual IBAN accounts, all of which raise funds from different sources, but all redirect to the same physical account. The company can assign a different virtual IBAN number to each supplier or customer. When the electronic payment is made, the banking system automatically clears the funds to the appropriate physical account. By using the virtual IBAN numbers listed on bank statements, businesses can identify the source of payment and simplify the manual reconciliation process.

 

Formation d'Institution de Monnaie électronique

 

Services provided by the electronic money institution

An e-money institution license is the right decision for payment service providers who are considering a broader range of services than instant payment processing.

  • Services allowing cash to be deposited into a payment account.
  • Services allowing cash withdrawals from a payment account.
  • Execution of payment transactions, including transfers of funds to a payment account with the payment service provider of the payment service user or with another payment service provider: execution of direct debits, including including one-off direct debits, execution of payment transactions via a payment card or similar device and / or execution of transfers, including standing orders.
  • Execution of payment transactions where funds are covered by a line of credit for a payment service user: execution of direct debits, including one-off direct debits, execution of payment transactions via a payment card or similar device and / or execution of transfers, including standing orders.
  • Issue and / or acquisition of payment instruments.
  • Money transfers.
  • Payment initiation service (PSD2 implementation).
  • Account Information Service (PSD2 implementation).
  • Issuing electronic money and safeguarding customer funds.
  • Creation of bank accounts with IBANs PL, GB and DE and CH
  • Manufacturing of Visa and Mastercard cards for each client

The UK, Germany, Poland and Switzerland have already implemented the second EU Payment Services Directive (PSD2) authorizing Payment Initiation Service (PIS) - launch of a payment order from the customer's bank account at the customer's request from the payment account held with another payment service provider (bank). PSD 2 also enables electronic money institutions to provide an account information service (AIS), access consolidated information on customer accounts held by other payment service providers (banks) and have a overview of clients' financial information.

Countries we work with