11 FAQs about e-money
FinTech / 08.05.2019
Enjoy all the benefits of e-money! Do you want to know more about it?
We are here to help!
What is e-money and can we touch it?
E-money is an equivalent of real money.
While you cannot touch it, by using e-money you can buy everything just like you can with real money. Although it doesn’t have a tangible form, it has real value that you can use when making purchases, payments and other uses of your money. It is a “digital alternative to cash” which allows its owners or users to make cashless payments with money which is stored on a card, a phone or over the internet.
E-money products can be either hardware- or software-based and this depends on the technology which is used to store the monetary value.
Where is e-money kept?
Just like paper money, e-money is kept in accounts or banking computer systems. However, these accounts boast a much higher security level than standard bank accounts.
When was e-money created?
The first European e-money directive dates back to 2000 and e-money has been regulated by the European Parliament since then.
Other sources indicate that e-money dates back to 1983 which allowed some users to use and transfer funds online.
Why was e-money created?
The goal of its creation was to counterbalance the monopoly of banks with regard to high fees and market regulation.
Who stands behind e-money accounts?
Financial institutions, similar to your bank, and called e-money institutions or electronic money institutions, stand behind these accounts. They have the right to issue and use electronic money.
What happens to my money when it is kept at an electronic money institution?
Your money is kept in so-called segregated accounts, which guarantee the inviolability of client funds and do not allow their use as financial resources for lending or investment, which is an activity that some banks engage in.
What can I do with e-money?
Everything you can do with paper money. And if you withdraw e-money from an ATM, it turns into paper money.
How secure is e-money and payments made with it?
E-money transactions are extremely secure due to the very advanced technologies and multi-tier customer identification procedures used.
Can I send e-money abroad?
Of course! You can send e-money to and from any licensed financial institution around the world.
Does e-money have any other advantages?
Yes! E-money is the fastest, easiest and most secure way to send or receive money with minimal fees through your online account at any time and at any place.
Is myPOS licensed to work with e-money?
myPOS Europe Ltd is registered in London, United Kingdom and is licensed by the Financial Conduct Authority as a financial institution for electronic money according to EU Directive 2009/110/EC (the “EMD”) as well as regulations from years 2011 and 2017.
Impact of Brexit on e-money
According to some sources, there’s a high financial dependency on the UK by many states and businesses. In particular, the UK is home to over 75% of e-money and payment firms operating on the continent.
Some questions arise about the movement of money, e-money and payment services after Brexit, which may be affected.
These questions relate to whether there will be smooth and quick transactions, whether there will be a need for the application of new licences in order for businesses to operate, whether these businesses will need to apply for licences in different EU states, and furthermore, the question of investing time and money into this venture.
Until there is more certainty around this topic in the form of legislation, these questions are likely to remain unanswered.