How is my electronic money protected?
How is my electronic money protected?
The electronic money that you have in your account with us is backed by money that we hold in a separate bank account or is covered by a guarantee or insurance policy that we may hold.
Money in the separate account is only available for the purposes of giving you back your money whenever you request it. This is different to banks which may use the funds they hold for you for different purposes. When we hold money separately for the purposes of safeguarding it is not generally available to our creditors, our bank or any other third parties. It means that whenever you ask us to return your electronic money, that money will be available.
This protection continues to be in place in the event our business gets into difficulty because that money (including the proceeds of any guarantee or insurance policy that we may hold) will continue to be held by the bank in the separate bank account and be available for you. Those funds will not be generally available to our creditors or other third parties but if we were to become insolvent then some of the funds may be used to pay an administrator’s fees and other costs related to the insolvency process. In that event, the total funds available to all our customers may be decreased by the amount due to the administrator.
How is safeguarding different to FSCS protection?
Banks adopt a different means of protecting their customers’ funds than electronic money institutions like us. They participate in the Financial Services Compensation Scheme (FSCS) – while we do not. The FSCS acts like an insurance policy for money held in bank, building society or credit union accounts where the bank, building society or credit union gets into difficulty. Under the FSCS, an individual is entitled to a maximum of £85,000 per eligible person, per bank, building society or credit union or up to £170,000 for joint accounts. What’s more, an administrator would not be able to use any of these funds.
When you keep money with us, it's safeguarded instead of having FSCS protection (sometimes called 'deposit protection'). As a result, it may take longer for your funds to be returned to you if they are held with us in comparison with a bank and, as outlined above, certain costs could be deducted from your funds.
Applicable to customers serviced by Paysafe Financial Services Limited only.