Legal perspectives on digital money in Europe

Abstract

Highlights the key features and differences between cash and electronic money and the benefits the former cannot deliver. However, consumer confidence is seen as the vital factor in acceptance of the latter. Summarises the four main areas identified by the European Commission in 1997 where public bodies can boost confidence. Ensuring stability and soundness of issuers of electronic money by defining an appropriate supervisory framework is seen as vital, as is the provision of guidance for issuers and users on liability and redress procedures. Clarification of EC competition rules is necessary to achieve an appropriate balance between interoperability and competition in these markets. Security also needs to be improved to tackle the risks of fraud, counterfeit, tax avoidance and money laundering. Reviews EU recommendations designed to cope with future development of card payment systems.