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ELM 6.4 Exceptions to the duty to redeem

Minimum redemption amount

ELM 6.4.1R

ELM 6.3.1 R does not apply if:

  1. (1)

    the e-money to be redeemed has a par value of less than:

    1. (a)

      (if the e-money is denominated in euro) 10 euro; or

    2. (b)

      (if it is denominated in another currency) the equivalent of 10 euro in that currency; and

  2. (2)

    this exception is expressly provided for by the e-money scheme rules.

Expiration of e-money

ELM 6.4.2R

If the e-money scheme rules provide that e-money ceases to be valid after a specified period, the redemption right does not apply after the end of that period.

ELM 6.4.3R

A firm must not issue e-money that is valid for less than a year. If a firm issues e-money to banks or other distributors who then distribute it to the public, the firm must use reasonable endeavours to ensure that it remains valid for at least a year after its distribution to the public.

Guidance

ELM 6.4.4G

The duty to redeem assumes that the person asking for redemption is able to present or make available the e-money for redemption. Thus, for example, if the e-money scheme in question is card based, and the person in question loses his card, ELM 6.3.1 R does not require the firm to reimburse the holder or redeem that e-money for him.

ELM 6.4.5G

A firm should consider whether it is under any duty to compensate a holder of e-money issued by it who loses his consumer e-money card or whose e-money is used fraudulently by another. For example, a firm should consider whether the duty of a card issuer under regulation 21 (Payment by card) of the Consumer Protection (Distance Selling) Regulations 2000 to recredit or to return sums in the event of fraudulent use of a payment card applies to it, particularly in the case of e-money stored on a plastic card.