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Prefunding
Overview
In some cases, authorities may require e-money issuers to set aside funds equal to 100% of outstanding e-money liabilities in licensed banks and/or other safe, liquid investments.
Safeguarding Customer Funds
HOW PREFUNDING WORKS
Photo Credit: Bill & Melinda Gates Foundation
Source: Bill & Melinda Gates Foundation
Safeguarding Customer Funds
Country Examples
Country Examples
Colombia
E-money issuers are required to deposit all customer funds in a demand deposit account in the Central Bank or another financial institution.
European Union
Either (i) 100% of customer funds must be isolated from the e-money issuer’s other funds and deposited in a separate account in a credit institution or invested in “secure, low-risk assets”; or
(ii) the e-money issuer must obtain insurance or some other comparable guarantee from an insurance company or a credit institution covering the full value of outstanding e-money liabilities.
