To ensure that funds of the users of payment services (the Clients) are safe Paynetics AD follows a process known as ‘safeguarding’ which is a regulatory requirement for all EMIs. In this process Paynetics AD keeps Clients’ money separate from its own money and places it in a safeguarding account with a bank.
Electronic money issued is not covered by any Deposit Guarantee Scheme which is a government backed scheme offering protection to customers’ funds of up to €100,000 per eligible customer. However, the aim of keeping funds equivalent to the value of the e-money in safeguarding accounts is to ensure that funds can be returned to the customer if the EMI becomes insolvent. The funds on the safeguarding accounts cannot be seized and forced execution cannot be carried out for obligations of Paynetics AD to persons other than the Clients.
In the event of an insolvency, Clients’ funds would remain in the safeguarding account at the designated bank and separated from Paynetics AD’s accounts and assets. Based on the applicable legal proceedings, the insolvency practitioner shall return the funds Paynetics AD has safeguarded to the Clients.