What is e-money?

What is e-money?

• A. A prepaid means of payment that can be used to make payments to multiple persons, where the persons are distinct legal or natural entities.
• B. A government-issued digital currency.
• C. A type of virtual asset used for investment.
• D. E-money is a prepaid means of payment that can be used to make payments to multiple persons, where the persons are distinct legal or natural entities; it can be online or card-based.

Answer: (D)

E-money is money stored electronically that has been prepaid and can be used to make payments to multiple payees. The key idea is stored value that you fund in advance, then access either online or through a card to pay others. This captures both the prepaid nature and the ability to pay many different recipients, whether you’re using a digital wallet online or a physical card. It’s different from a government-issued digital currency (CBDC), which is issued by the central bank, and from virtual assets used for investment (like some cryptocurrencies), which aren’t prepaid stored-value payment instruments. The added detail that it can be accessed online or via a card helps distinguish e-money from other forms of digital value.

E-money is money stored electronically that has been prepaid and can be used to make payments to multiple payees. The key idea is stored value that you fund in advance, then access either online or through a card to pay others. This captures both the prepaid nature and the ability to pay many different recipients, whether you’re using a digital wallet online or a physical card.

It’s different from a government-issued digital currency (CBDC), which is issued by the central bank, and from virtual assets used for investment (like some cryptocurrencies), which aren’t prepaid stored-value payment instruments. The added detail that it can be accessed online or via a card helps distinguish e-money from other forms of digital value.