http://www.legislation.gov.uk/uksi/2011/99/part/5/madeThe Electronic Money Regulations 2011Business practice and regulationLiabilitiesRegulation and deregulationLegislationenKing's Printer of Acts of Parliament2024-05-09FINANCIAL SERVICES AND MARKETSThese Regulations implement Directive 2009/110/EC of the European Parliament and of the Council of 16th September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions (“the Directive”) (OJ No L 275, 27.10.2000, p.39).PART 5ISSUANCE AND REDEEMABILITY OF ELECTRONIC MONEY38Application of Part 5

This Part applies to the issuance and redemption of electronic money where the issuance or redemption is carried on from an establishment maintained by an electronic money issuer or its agent in the United Kingdom.

39Issuance and redeemability

An electronic money issuer must—

a

on receipt of funds, issue without delay electronic money at par value; and

b

at the request of the electronic money holder, redeem—

i

at any time; and

ii

at par value,

the monetary value of the electronic money held.

40Conditions of redemption

An electronic money issuer must ensure—

a

that the contract between the electronic money issuer and the electronic money holder clearly and prominently states the conditions of redemption, including any fees relating to redemption; and

b

that the electronic money holder is informed of those conditions before being bound by any contract.

41Fees for redemption1

Redemption may be subject to a fee only where the fee is stated in the contract in accordance with regulation 40(a), and—

a

redemption is requested before the termination of the contract;

b

the contract provides for a termination date and the electronic money holder terminates the contract before that date; or

c

redemption is requested more than one year after the date of termination of the contract.

2

Any fees for redemption must be proportionate and commensurate with the costs actually incurred by the electronic money issuer.

42Amount of redemption1

Where before the termination of the contract an electronic money holder makes a request for redemption, the electronic money holder may request redemption of the monetary value of the electronic money in whole or in part, and the electronic money issuer must redeem the amount so requested subject to any fee imposed in accordance with regulation 41.

2

Where an electronic money holder makes a request for redemption on, or up to one year after, the date of the termination of the contract, the electronic money issuer must redeem—

a

the total monetary value of the electronic money held; or

b

if the electronic money issuer carries out any business activities other than the issuance of electronic money and it is not known in advance what proportion of funds received by it is to be used for electronic money, all the funds requested by the electronic money holder.

43Requests for redemption

An electronic money issuer is not required under regulation 39(b) to redeem the monetary value of electronic money where the electronic money holder makes a request for redemption more than six years after the date of termination of the contract.

44Redemption rights of persons other than consumers

Regulations 41 and 42 shall not apply in the case of a person, other than a consumer, who accepts electronic money and, in such a case, the redemption rights of that person shall be subject to the contract between that person and the electronic money issuer.

45Prohibition of interest

An electronic money issuer must not award—

a

interest in respect of the holding of electronic money; or

b

any other benefit related to the length of time during which an electronic money holder holds electronic money.

46Termination of a contract

For the purposes of this Part a contract between an electronic money issuer and an electronic money holder terminates when the right to use electronic money for the purpose of making payment transactions ceases.

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<heading>Application of Part 5</heading>
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<p>This Part applies to the issuance and redemption of electronic money where the issuance or redemption is carried on from an establishment maintained by an electronic money issuer or its agent in the United Kingdom.</p>
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<heading>Issuance and redeemability</heading>
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<p>An electronic money issuer must—</p>
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<p>on receipt of funds, issue without delay electronic money at par value; and</p>
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<p>at the request of the electronic money holder, redeem—</p>
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<p>the monetary value of the electronic money held.</p>
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<p>Where before the termination of the contract an electronic money holder makes a request for redemption, the electronic money holder may request redemption of the monetary value of the electronic money in whole or in part, and the electronic money issuer must redeem the amount so requested subject to any fee imposed in accordance with regulation 41.</p>
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</intro>
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