At the seventh ordinary session convened on December 22,2023, the National Assembly of the Republic of Srpska adopted the Electronic Money Act, which regulates this modern payment instrument for the first time in our country.
The RS E-money Act in Article 2 defines the concept of e-money as an electronically or magnetically stored monetary value that constitutes a monetary claim against the issuer of that money. Based on the contract on issuing e-money, the issuer undertakes to issue e-money to the holder in the nominal value of the funds received. In fact, it is money that the issuer “converts” into electronic form, so that it can be used as a payment instrument.
The Act also explicitly states which monetary values cannot be considered e-money in the sense of this Act. As follows, for example, the provisions of this Act will not apply to monetary values of vouchers, gift cards, public transport tickets, and the like.
The holder of e-money can be any legal or natural person who concludes an Agreement on Issuing E-money with an authorized issuer.
On the other hand, the Act devotes more attention to the term of the Electronic Money Issuer. Thus, issuers of e-money understand banks, microcredit companies, companies for issuing e-money, and even the Ministry of Finance and local self-government units if they do so within their exclusive competences. In any case, companies that intend to be issuers of e-money must fulfil the conditions prescribed by law for the performance of this activity, the fulfilment of which is assessed by the Banking Agency of the Republic of Srpska when issuing a license to operate, i.e. a license to issue e-money.
From the aspect of legal form, e-money issuing companies can be organized as joint-stock or limited liability companies, and the minimum founding capital according to Article 28 of the Act must be at least 700,000.00 BAM.
In addition, the Act prescribes particular conditions that a person must fulfil in order to perform the function of the director of a company for issuing e-money, which concern his/her business reputation, as well as for a manager for whom conditions are prescribed in terms of his/her appropriate education and work experience that he/she must meet with the obtained special consent of the Banking Agency.
The supervision of e-money issuance is entrusted to the RS Banking Agency. The Agency supervises it indirectly — by collecting and analysing reports and other documentation submitted by companies, directly — by inspecting the business books, documentation, and data of the company, as well as imposing supervision measures. Among the surveillance measures, there is also the possibility that the Agency may revoke the company’s work license in certain cases prescribed by law.
The Act on Electronic Money granted broad powers to the Banking Agency due to the nature of the activities regulated by this Act. However, these powers exceed even the usual expectations, bearing in mind that the Agency’s discretionary decision-making power reaches even the possibility for the Agency to decide on the scope of application of certain legal norms.
Whether the Act on Electronic Money can meet the requirements of this modern manner of transactions is a question that can only be answered through the practice that is yet to come, bearing in mind that this Act has only created the possibility for e-money to enter circulation on the domestic market. However, given that e-money has been present and legally regulated on foreign markets, the Act on Electronic Money definitely represents a step forward for us.
Author: Jelena Milinkovic
E-mail: [email protected]
