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A Comparative Analysis of Electronic Money in United Kingdom and Pakistan

Author Affiliations

  • 1Law Department Abdul Wali Khan University Mardan KPK, PAKISTAN

Res. J. Recent Sci., Volume 3, Issue (2), Pages 133-140, February,2 (2014)

Abstract

Over the years, there is phenomenal change in technology and market competition and these are the forms through which the money ownership is transferred from one person to another. Originally a physical substance such as gold and silver or even alive – cattle were considered as forms of money. Even though the greater amount of money used by the individuals in their daily transactions is still in the form of coins and notes, but if we compare it with the intangible money that exists only as entries in bank records, it quantity is much smaller. Perhaps banknotes and coins will become as obsolete as cowries’ shells. This intangible (electronic) money acts as a replacement for cash, where monetary value is stored on a smart card and is used to make daily small payments. Therefore, electronic money has become an essential element and affects our lives in one way or another. This paper investigates the electronic money in two different regimes that is, The United Kingdom and Pakistan. Here the Legal Framework, payment mechanism, permission for issuance, authorization requirements and purse limit of the electronic money in these two countries has been investigated. Prudential and other requirements which are regulating and affecting the electronic money in these regimes have been investigated here. The various restrictions and limitations imposed by the authorities in these regimes on the electronic money firms have been discussed in this paper. Assessments of the Consumer Protection laws in these regimes which are relevant to the electronic money have been touched as well.

References

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  10. S.I. 2001/544 (2001)
  11. Regulated Activities Order, Article 9BFSMA (2000)
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  15. A ‘lead regulated firm’ is defined in the Glossary of Definitions as ‘a firm, which is the subject of the financial supervision requirements of an overseas regulator in accordance with an agreement between the FSA and that regulator relating to the financial supervisions of firms whose head office is within the country of that regulator’ (2000)
  16. An incoming EEA firm is an EEA firm which is exercising or has exercised its right to carry on a regulated activity in the United Kingdom in accordance with Schedule 3 to the FSA (EEA “passport rights”) while an incoming Treaty firm is a Treaty firm that is exercising or has exercised its right to carry on a regulated activity in the United Kingdom in accordance with Schedule 4 to the FSA (Treaty rights) (2000)
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  18. An ‘EEA firm’ issuing electronic money is one which has its head office in any EEA country other than United Kingdom but it is authorized by its home state regulator and its ‘Passport Rights’ are the rights to establish a branch in or to provide cross border services into the United Kingdom under a ‘single market directive’ and an EEA firm exercising these right is an incoming EEA firm (2003)
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  21. The right to redeem must be expressed as a contractual term. For this purpose, the e-money firm must ensure that there is a contract between itself and any person to whom it issues e-money or any person with a redemption right (such as a merchant accepting its e-money as payment), in the case of the former, before it issues the e-money and in the latter before the person with the redemption right obtains the e-money or as soon as reasonably possible afterwards. (ELM § 6.7)FSMA (2000)
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  23. Scheme set up under Part XVI of the FSMA 2000 by which some disputes may be resolved quickly and with minimum formality by an independent person. S. 225 - 234 of the FSMA (2000)
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