What is the Electronic Payment of Funds Institution?
As a result of the new regulation emitted by the legislative branch in Mexico through the expedition of the Law to Regulate Financial Technology Institutes (LFTI) we consider as vital to recognize which are the technology entities this law regulates.
It is now turn to analyze the Electronic Payment Institutions, so to, as what is setted in article 22 of the LFTI are those that serve the public and consist in the emission, administration, redemption and transmission of electronic payment funds in a regular matter and using informatic applications, interfaces, web pages or any other electronic or digital communication mean.
Is important to notice that the operation through which the mention operations are committed can only be executed by moral people, that’s to say, societies, authorized by the Banks and Values National Commission through an agreement by its inter institutional Committee as Electronic Funds Payment Institutions in the same way that occurs in Collective Funding Institutions.
In the LFTI is disposed that are considered Electronic Payment Funds (EPF) those funds that are accountable in electronic register and transnational accounts, that for this matter is regulated by an Electronic fund payment institution and also that are referred a monetary value equivalent to a specific amount of money, either in national currency, same that would be approved by the Bank of Mexico (BM) or in foreign currency, or even by a determined quantity of virtual assets set by the BM.
Some services and activities authorized by the Electronic Payment Institutions are:
- Open and administrate electronic payment funds accounts, recording incomes and bonus registers received in such accounts and emitted against the receivement of money that could be in national or foreign currency or determined virtual assets;
- Electronic fund payments transfer through the according bonuses and charges of the administrative accounts.
- Money transfers in national currency, previous authorization of the BM, in foreign currency or virtual assets, through bonuses and charges of the accounts of their clients and other electronic fund payment clients, as well as account holders or users of other Financial Entities or foreign entities that will facultate to make operations similar to those authorized by such electronic payment institutions.
It is also important to notice that there are operations that use informatic applications, interfaces, web pages or any other electronic communication mean that this law excludes such as:
- The right derivative of loyalty and rewards programs, same that are offer by moral people to their clients and that are accepted only by its affiliates and that are also unable to be converted into currency in national territory.
- The mounts for the acquisition of goods and services that are only accepted by the emitor or any society that belong to the same consortium or Company Group and when this can´t be converted to national currency.
- Money deposits that the financial entities received according to the respective laws that explicitly authorized them to such operations.
- The transmission of money through Financial Entities or Money transmitters that are referred in the General Law of credit auxiliary Organizations or Activities
The Electronic Payment Institutions as well as the Collective Funding institutions, are new lawful figures in our country, as the actual and future regulations, because the emissions of such rule and norms is still pendent, it is with this that we hope to throw a lawful, current, dynamic framework in the New Information Technologies.