Progress in the financial technology area over time has facilitated development of new types of settlement. One of such means is electronic money or e-money, which, along with scriptual money and cash, also serves as a legal means of payment. E-money is monetary value stored in an electronic device, which is issued in exchange for funds and is intended for payment purposes.
Permit granted by Latvijas Banka is required to carry out e-money issuance. As a general rule, electronic money institutions that have been granted authorisation are engaged in the activity of issuing electronic money.
If the planned activity is limited and it meets certain conditions, it is possible to obtain preferential authorisation from Latvijas Banka – it is sufficient to acquire the status of a registered electronic money institution. In this case, the circulation of e-money may only take place in a closed loop and limited amount, and services may only be provided in Latvia and to customers associated with Latvia.
In view of the fact that e-money is intended for payments, most frequently in addition to the e-money issuance the electronic money institutions also deal with the provision of payment services. The provision of the relevant payment service is specified in the operating authorisation issued to the electronic money institution.
Consultations with experts of Latvijas Banka
Latvijas Banka specialists offer advice to prospective market participants to help better understand the regulatory requirements on the process of authorisation, as well as to identify potential challenges by developing new and innovative products or business models.
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