Electronic money payment systems as an alternative to banking institutions

What is electronic money?

In a nutshell, electronic money (also called “e-money”) is a digital record of value in a given system. E-money can be exchanged between two parties, but no one actually touches money because all that happens is an exchange of electronic records.

The media that stores this predefined value or payment information can be either hardware or software.

You might be surprised, but every payment and transaction you make with your debit or credit cards is electronic and involves the exchange of electronic money. The hardware, or key, that gives access to the electronically stored value of your checking account is the card itself. In fact, financial information is stored in the chip and magnetic stripe. When you use this payment method, after reading the card on a POS reader, a connection and subsequent exchange of values (e-money) takes place between your bank and the merchant's bank. They are connected to a server over the Internet to verify and confirm a transaction. It is also possible to make a payment even without a real-time connection - for example, when shopping on board an airplane. In these cases, the transaction is finalized at a later stage.

Online banking also stores your money electronically - on servers. Prepaid card issuers, digital wallets and other financial institutions can accept cash and in return issue you electronic money to pay in the digital world.

Electronic money company licensed by the FCA (Financial Conduct Authority) - the most transparent supervisory authority that issues licenses for electronic money operators is located in London - Great Britain.

There is, however, one major difference.

What is an electronic money company?

In the simplest terms, companies such as Wise, Juni, Monese, iCard, Revolut and many others are licensed to issue electronic money and have the right to develop and provide digital payment solutions.

Here are a few reasons why your money is better protected with electronic money institutions:

How Smart Startup UK lawyers can help

Suppose you set yourself the task of opening an account in a foreign bank. In such a case, Smart Startup UK lawyers are ready to carefully consider the business case and answer the question "can I open a foreign bank account?" in your case, as well as in which jurisdiction this option will be available to you and most advantageous. For example, many banks in Singapore and Hong Kong refused to open a bank account for foreign citizens from the CIS. Therefore, the lawyers of "Smart Startup UK" will help you to avoid the risks of rejection and loss of time by choosing the most suitable options for your business to open a bank account. In particular, the lawyers will help in the successful implementation of the following actions: