A card that has a specific amount of money pre-loaded onto it is known as a pre-paid card. This type of card can be utilized to conduct payment transactions at POS terminals as well as online, provided that the card is accepted. Retail shops offer pre-paid cards in the form of gift cards.
License for Issuing Pre-Paid Cards
Non-financial or authoritative bodies that wish to issue pre-paid cards must first seek approval from the relevant financial body and obtain the necessary license as stipulated by the country in which the company operates from.
It is imperative to obtain the relevant license as it demonstrates that the company is legally complaint with jurisdictional regulations. The license shows that the company observes the relevant standards of issuing pre-paid cards set by the regulatory authority.
The following is a brief outline of the requirements companies must meet in order to become pre-paid card issuers:
- Typically be a limited liability company (LLC)
- Evidence of the minimum start-up capital
- Implementation of anti-money laundering and anti-fraud measures
- Company must meet the requirements in terms of structure and internal and external operations to obtain the license
- Entities must have an effective control system
It is important that the issuing company understands the requirements involved to obtain a pre-paid card license. It is highly advised to seek the support and guidance of a professional consultancy firm that is experienced in pre-paid card requirements and implementation.