Past version: effective from 01/04/2020 - 31/03/2020
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This table sets out the requirements that must be complied with under COB section 13.6 by an Authorised Firm issuing Stored Value.
Issue and redemption of Stored Value
An Authorised Firm must:
(a) on receipt of funds from a User, issue Stored Value at par without delay; and
(b) upon the request of a Stored Value holder, redeem at par the Stored Value held, except where such a request is received more than 6 years from the termination of the relevant Client Agreement to issue Stored Value.
No interest or other return permitted
An Authorised Firm must not pay any interest or other return on Stored Value.
Limit on stored value issued and transactions
An Authorised Firm must maintain effective systems and controls which ensure that:
(a) the total amount of Stored Value on issue to any individual User at any point in time does not exceed $5,000; and
(b) no single Payment Transaction relating to Stored Value exceeds $1,000.
Rule A7.3.2 prohibits an Authorised Firm from paying any interest or other return on Stored Value. This prohibition is intended to remove the likelihood or perception that the funds are held as deposits. However, the Rule does not prevent the Authorised Firm from offering incentives that encourage the use of stored value, such as reward points or merchant discounts.