Many of us frequently use e-money. If you are – for example – using paysafecard, you are using e-money. However, the term “e-money” or “electronic money” itself is not widely used. It seems as if many of us are still unsure what “e-money” actually stands for. That’s why we thought it might be helpful to have a closer look at e-money.
As the term “electronic money” already implies, e-money is money stored electronically on a device or remotely at a server. Common types of e-money include certain forms of online accounts as well as prepaid vouchers such as paysafecard. However, cards and vouchers are not called e-money if they can be used in shops connected to the company that issues the product. Therefore, gift cards are not necessarily e-money. As customers can buy our prepaid vouchers at 450,000 physical sales outlets to use them as a means of payment at more than 3,500 online shops across the world, paysafecard is e-money.
In order to get e-money, users exchange a certain amount of money for a card or a voucher of the same value. paysafecard vouchers are available in denominations of EUR 10, EUR 25, EUR 50 or EUR 100 (or similar amounts in other currencies). The unique 16-digit PIN that comes with a paysafecard is the digital equivalent of a banknote. That’s why it should be treated with the same care.
There are many laws and regulations in place which must be complied with when issuing e-money. Before a company can launch an e-money product, it needs to apply for an e-money license. Our main product paysafecard is issued by the Prepaid Services Company Ltd., a subsidiary of paysafecard.com Wertkarten AG in Vienna. The Prepaid Services Company Ltd. is an official e-money institution which holds an e-money license granted by the British Financial Services Authority (FSA). This license allows us to issue paysafecard within the European Union. In other countries such as Switzerland, the US, Canada, Mexico or Argentina, other licenses are required.
Like every e-money institution, we have to adhere to numerous laws to keep our licenses. Similar to other financial institutions such as banks and credit card companies, this includes regulations concerning money-laundering or fraud prevention.
All these regulations and requirements ensure that our e-money products are not only convenient, but also secure – and frequently used in more than 30 countries.