This document is an excerpt from the EUR-Lex website
Electronic money: business and prudential supervision
- Date of last review:
- 21/03/2016
- Initial creation date:
- 02/06/2010
- Summary code:
-
- 14.09.03.02 Payment services
- EUROVOC descriptor:
- Directory code:
- Summarised document(s):
- Author:
- Publications Office of the European Union
- Responsible entity(ies):
- Publications Office of the European Union
Electronic money: business and prudential supervision
SUMMARY OF:
Directive 2009/110/EC — the business and supervision of electronic money
WHAT DOES THIS DIRECTIVE DO?
- The electronic money directive (EMD) sets out the rules on the business and supervision of electronic money1 (e-money) institutions in order to contribute to the emergence of a true single market for e-money services in the European Union (EU).
- It also seeks to ensure consistency with the EU’s payment services directive (Directive 2007/64/EC, known as the PSD), thus contributing towards a single EU market for payments for the benefit of consumers, business and the wider EU economy.
KEY POINTS
In general, the EMD aims to:
- facilitate the emergence of new, innovative and secure e-money services;
- provide market access to new companies;
- encourage effective competition between all market participants.
Specifically, it modernises EU rules on e-money, in particular bringing the prudential regime for e-money institutions2 into line with the requirements for payment institutions in the PSD.
It introduces proportionate prudential requirements in order to ease market access for newcomers. This includes reducing the initial capital requirement to €350,000 and new rules on calculating own funds.
The institutions covered by the EMD include banks, e-money institutions, the European Central Bank and national central banks.
The activities which e-money institutions are permitted to carry out include providing payment services and granting credit related to these payments.
In October 2015, the EU adopted a new directive on payment services known as PSD2. It repeals Directive 2007/64/EC with effect from . PSD2 aims to improve security, widen consumer choice and keep pace with innovation.
FROM WHEN DOES THE DIRECTIVE APPLY?
It applies from . EU countries had to incorporate it into national law by .
BACKGROUND
KEY TERMS
- Electronic money is the digital alternative to cash, which enables users to store funds on a device (card or phone) or through the internet and to make payment transactions.
- E-money institutions are organisations that have been authorised to issue electronic money.
ACT
Directive 2009/110/EC of the European Parliament and of the Council of on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, , pp. 7–17)
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