Trilogue Recommendations on PSD3/PSR
Ensuring Legal Certainty for E-Money Distribution

Position of the associations

• Prepaid Association of Germany e.V. (Prepaid Verband Deutschland e.V. – PVD)
• BrancheVereniging Cadeaukaarten Nederland (BVCNL)
• Electronic Money Association (EMA)
• European Payment Institutions Federation (EPIF)
• EuroCommerce
• European Payment Service Providers for Merchants (EPSM)
• Gift Card & Voucher Association (GCVA)
• Independent Retail Europe
• Payments Innovation Forum (PIF)
• Payments Innovation Forum (PIF)

The trilogue negotiations on PSD3 and PSR are a decisive moment to ensure that millions of Europeans can continue to buy, gift, and use simple electronic money products such as prepaid vouchers and gift cards. These products are not just a convenience, they are a tool of financial inclusion, offering an easy, cash-like solution for people without bank accounts or credit cards, and a trusted gift or budgeting tool for millions of households.

E-money products are available at over 800.000 retail outlets across the EU, from supermarkets and petrol stations to local shops. These outlets are not providing payment services; they are simply offering consumers access to popular and trusted products. If PSD3 creates unnecessary complexity by misclassifying such actors, consumers risk losing access to these products and SMEs face disproportionate new burdens.

This industry coalition of electronic money issuers, distributors, and retailers therefore urges co-legislators to consider the following

Recommendations

• Ensure clarity: Retain Council’s Recital 45 and Article 20(4) to confirm that the selling, distribution, and redemption of e-money do not constitute payment services and therefore are not agent activities.
• Consistency: Add “redemption” explicitly to Article 20(4) to align with Recital 45.
• Avoid unnecessary burdens: Remove the legal notion of “distributor” to prevent disproportionate compliance costs for retailers and SMEs that only sell or redeem e-money vouchers or gift cards.

Why This Matters

• Consumer choice and Inclusion: Prepaid vouchers and gift cards are a widely used budgeting and gifting tool. Moreover, they provide an accessible payment alternative for people without a bank account or credit card.
• SMEs: Retailers and local shops should not face disproportionate compliance burdens for simply selling or redeeming vouchers.
• Supervisors: Legal clarity avoids confusion, avoids unnecessary bureaucracy, and keeps accountability with the issuing payment institution.

Council’s Position – The Right Balance

The Commission was right to identify the need for clarity on roles in the e-money value chain. The Council’s proposal offers a more proportionate solution that works even better in practice for all actors involved:

• Remove the legal term “distributor” (Article 2(36) PSD3 and Article 3(51) PSR).
• Clarify instead in Article 20(4) and Recital 45 that the mere selling, distribution, or redemption of e-money does not constitute a payment service and therefore is not the activity of an agent.

This approach ensures clarity for supervisors, avoids undue burdens for retailers, and preserves the Commission’s objectives of consumer protection and legal certainty. 

Redemption – The Missing Piece

Council’s Recital 45 makes clear that persons acting on behalf of a payment institution may facilitate distribution and redemption without providing payment services. But Article 20 remains inconsistent: while it allows agents to redeem e-money, it leaves uncertainty over whether redemption by other actors automatically makes them “agents.”

This ambiguity could disrupt existing business models. Redemption is simply the right of the e-money holder to exchange e-money for funds, it’s not an independent payment service.

Proposed Legal Clarification

To align Article 20(4) with Recital 45 and current market practice, we propose the following wording:

“The mere selling, or distribution or redemption of electronic money, including the receipt of funds by the person distributing the electronic money on behalf of the payment institution in exchange for the electronic money issued, on behalf of the issuer of electronic money, shall not by itself constitute the activity of an agent.”

This is a technical alignment, not a political change: it ensures consistency across the text, legal clarity and avoids unintended disruption.

Oversight and Accountability

• The issuing payment institution is always legally responsible for the distribution chain.
• Oversight is ensured through contractual arrangements with distributors and points of sale.
• If an entity provides services beyond simple distribution (e.g. carrying out payment services on behalf of the payment institution) it is rightly classified as an agent and must comply with the full agent regime.

This ensures a proportionate framework: consumer protection is safeguarded, supervision is effective, and the market remains open and innovative.

Conclusion and Call to Action

We call on the co-legislators to endorse the Council’s approach in Recital 45 and Article 20(4), and to include an explicit reference to “redemption” in Article 20(4). This solution:

• Provides legal certainty for supervisors, issuers, and retailers.
• Safeguards consumer access to trusted and inclusive e-money products.
• Reduces unnecessary regulatory burdens on SMEs and retailers.
• Avoids unnecessary bureaucracy and supervisory burden for supervisory authorities.
• Ensures that the issuing payments institution remains fully accountable for the
  distribution chain.

By adopting this clarification in trilogue, the EU will strengthen financial inclusion, preserve consumer choice, and maintain a proportionate and effective regulatory framework for e-money.