Electronic money
Electronic money is money stored electronically, and spent by using a technical device, such as a smart card.[1] If it is stored on a card, its use may be secured by a PIN code. In Japan, electronic money is commonly used to pay for train tickets. JR East’s prepaid train ticket (Suica) and JR West’s IC Operating card (ICOCA). Suica and ICOCA are plastic cards with a built-in IC chip. Suica was originally introduced in 2001.
In addition, many types of electronic money are used in other train stations in Japan. For example, Kitaca is electronic money in the Hokkaido area, Sugoca is used in the Kyusyu area, etc. Most electronic money is also used to pay for goods at convenience stores in Japan.
In 2004, NTT DoCoMo launched a mobile phone that uses smart card chip to realize electronic money capability. Recently, many people have been using these kinds of electronic money cards in Japan.
Note, that electronic money is always backed by real money. For this reason, cryptocurrencies cannot be used as electronic money.
In the European Union, authorized and regulated electronic money institutions can issue e-money which serves as a "digital alternative to cash". The issuance of e-money is governed by the Directive 2009/110/EC "on the taking up, pursuit and prudential supervision of the business of electronic money institutions". The Directive also describes e-money as a "technically neutral ... electronic surrogate for coins and banknotes".
In June of 2019, the Icelandic company Monerium become the first company authorized to issue e-money tokens on blockchains.
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- ↑ "Electronic money". European Central Bank. European Central Bank. Retrieved 2020-06-01.