The supervisory regime for EMIs is similar, mutatis mutandi, to those which apply to other regulated entities:
- fitness and probity of relevant parties
- sound internal control systems
- sound administrative and accounting principles
- adequate capital levels, liquidity, etc
Unique E-Money Requirements
There are certain features/requirements that are unique to E-money and EMIs. These include:
- EMIs must not undertake or carry on business other than issuing E-money and the provision of financial and non financial services closely related to issuing E-money
- Each EMI must have initial capital of at least €1 million. On an ongoing basis it must maintain capital equal to 2 per cent of E-money issued or €1 million, which ever is the higher
- The maximum storage capacity of each issued electronic device should not exceed €5,000
- Small issuers of e money may benefit from a waiver of certain requirements under certain conditions
- The bearer of E-money has the right at all times to demand repayment from the EMI of any balance outstanding on the device
- EMIs can only invest its assets (essentially the balances of unused E-money devices) in cash or near cash items (i.e. assets carrying a zero weighting in the context of banks’ capital adequacy requirements)
Further details of the supervisory requirements for EMI’s are set out in the guidance note:
Guidance notes on the preparation of an EMI’s application and regulatory standards for their ongoing supervision