NUAPAY a Payment Institution
In their drive to make the economy in Europe more efficient the politicians decided one route would be to introduce competition to the established banks in a number of business activities. One area that attracted attention was the world of payments as the cost of processing payments is seen purely as an overhead on any business and not contributing in any way to the development of that business. To this end a new type of regulated company, a Payment Institution, was introduced in 2009. Nuapay is licenced and regulated as a full Payment Institution.
What can a Payment Institution do?
As the name suggests a Payment Institution is an organisation that specialises in providing payment services to its customers. To enable this to happen the Payment Institution can issue accounts to their customers with this account being in the customer name and having an account number that will look like and work like a standard bank account number. By using their account, customers can make or receive payments in exactly the same way they could with a bank, transferring funds with any other appropriate account within any EEA country. The Payment Institution can also provide customers with the necessary authority to make and receive payments electronically including authorising the use of direct debits.
With Nuapay, Sentenial’s Payment Institution, customers are issued with one or more accounts as appropriate for their needs with these accounts being accessible and managed over the Internet. Customers can make or receive credit transfers and direct debits with the money either being received into or paid out of their Nuapay account.
In addition to facilitating the processing of payments, Nuapay provides customer with a wide range of features that greatly simplify both the processing and management of payments.
What can’t a Payment Institution do?
Nuapay can issue customers with accounts that look and feel like a bank account but there are necessarily some limitations on what these can be used for. There are two main limitations, the first being that Nuapay is not allowed to take deposits from customers and pay interest on them. The second area is that Nuapay is not allowed to use the money customers have in their account for any other purpose than supporting payments initiated by the customer. All customer money must be held at all times in safeguarded accounts that Nuapay itself holds with other financial institution.
These two aspects are the major differentiators between a bank, that accepts funds from a customer and invests these funds for profit, and a Payment Institution that cannot use and is obliged to hold all of the customer’s money in a safe location.
Is my money safe?
As discussed above a Payment Institution must hold all customer funds in safeguarded accounts held in other financial institutions. All of the customers’ money is thus fully protected against Nuapay not being able to fulfil any of its obligations. Additionally Nuapay is obliged to retain a significant level of liquid capital that the regulator can call on should any issues arise.
This differs substantially from banks where only a relatively small percentage on customer’s money is safeguarded.
Who regulates a Payment Institution?
Payment Institutions are regulated in much the same way that banks are, each EEA country having its own regulator. Nuapay is regulated in London by the Financial Conduct Authority (the FCA).
The regulations under which Nuapay operates cover all aspects of the business ranging from the test that have to be used before an account can be issued to a customer, through the need to hold defined levels of capital reserves and on to the anti-fraud measures that have to be followed when payments are processed.
The EU regulations allow Nuapay to provide payment services in all EEA countries under the FCA regulation.
Nuapay is regulated and award winning
|The Quality Management Standards for Europe||Approved Payment Institution||Associate Member of FPAI
Fintech & Payments Association of Ireland
|Nuapay has won the Payforum Award 2015||Member of the Electronic Money & Payments Working Group||Associate Member of the Association of UK Payment Institutions|