Gibraltar Electronic Money Institutions License
E-money is electronically, including magnetically, stored monetary value, represented by an issuer which is accepted by a person other than the electronic money issuer. Types of E-money include pre-paid cards and electronic pre-paid accounts for use online.
The regulation of Gibraltar E-money Institutions falls within the scope of the Financial Services (Banking) Act 1992 and, specifically, the Financial Services (Electronic Money) Regulations 2011 (“the Regulations”). E-money Institutions should ensure that they comply with all subsidiary legislation to the Act.
An E-money Institution is authorized to issue and redeem E-money and this can be done either via a proper establishment or through an Agent or Distributor.
There are two types of E-money Institutions
Both these types of E-money Institutions must meet certain standards and provide the necessary information so that the GFSC can monitor and supervise them effectively.
You should note that registered E-money Institutions cannot passport their services.
Agents and Distributors
An E-money Institution may appoint agents and distributors. Agents distribute and redeem e-money, and provide payment services. These must be registered with the GFSC.
Distributors distribute and redeem E-money without providing payment services. The FSC must be notified of these.
Neither an agent nor a distributor can issue E-money; this activity may only be carried out by the E-money Institution.
In order to allow the GFSC to carry out its supervisory and regulatory functions, the GFSC has established a policy for the supervision of E-money Institutions.
The following conditions are applied to all licenses issued to E-money Institutions. They must comply with money Institutions on an ongoing basis:
Guidance – Safeguarding Requirements
In accordance with Section 20 of the Regulations, every E-money Institution must satisfy the GFSC that it has adequate arrangements in place to safeguard the funds of customers that have been received in exchange for E-money that has been issued and prevent the use of these funds for the E-money Institution’s own account.
An E-money Institution shall safeguard customer funds by:
Additionally, an E-money Institution that holds customer funds must keep such records and accounts as are necessary to enable them at any time and without delay to distinguish funds held for one customer from another and from the funds of the E-money Institution.
An authorized E-money Institution is required to hold an initial and ongoing capital of:
A small or registered E-money Institution is required to hold an initial and ongoing capital of 2.2%* of the average outstanding electronic money.
Firms holding multiple licenses may be required to hold the aggregate of the capital required for each license prior to being permitted to conduct the proposed activity, and on an ongoing basis. The level of capital in these cases will be considered by the GFSC. It is advised that you discuss this with the GFSC ahead of your application.