Written by WithMetis Markets

4 minute read

In today’s digital age, the world of finance is rapidly evolving, and traditional banking systems are facing new challenges. Historically, banks have occasionally failed to provide the necessary safeguards for customers’ funds, leading to financial losses and trust issues. At WithMetis Markets, we are acutely aware of the importance of ensuring the security and protection of fiat funds, especially for users that are not eligible for a non-pre-fundable account. That is why we have partnered with Electronic Money Institutions (EMIs) to provide our clients with enhanced safeguarding and peace of mind.

The Role of EMIs: EMIs, such as Modulr Finance B.V. in the Netherlands or Intergiro Intl AB in Sweden, are licensed financial institutions specializing in electronic payment services and safeguarding customer funds. They operate under the supervision of regulatory bodies, such as De Nederlandsche Bank (DNB) and the Swedish Financial Supervisory Authority, ensuring compliance with stringent financial regulations.

Enhanced Fund Protection: When partnering with an EMI, we aim to keep our and users’ funds segregated, safe and secure. Unlike traditional banks, the EMIs we chose have implemented robust measures to protect client funds, as outlined below:

1.Segregation of Funds: EMIs hold customer funds separate from their operational funds. These funds are identified as belonging to the clients and are held in dedicated accounts at reputable banks.

2.Independent Custodian: EMIs employ the services of an independent custodian, often referred to as a “Stichting” or foundation. This separate legal entity holds the funds solely for the benefit of the clients, ensuring an additional layer of protection.

3.Regulatory Compliance: EMIs are subject to strict regulations imposed by regulatory authorities. Compliance with these regulations is essential to maintain the integrity and security of customer funds.

4.Safeguarding Account: EMIs establish safeguarding accounts with reputable banks to protect customer funds. In the unlikely event of the EMI ceasing operations, customer funds remain separate and are not exposed to claims from other creditors.

5.Additional Capital Requirements: EMIs are mandated to hold additional “own funds” to minimize risk further and facilitate the orderly winddown of operations. These funds provide an added layer of protection and ensure the return of customer funds.

6.Insolvency Preparedness: EMIs must develop comprehensive plans for orderly winddowns, including early identification of potential insolvency events. These plans are shared with regulatory bodies and subject to external audit reviews to reduce the risk of customer fund losses.

Benefits of Partnership: The partnership between WithMetis Markets and those EMIs offers numerous advantages, including:

1.Enhanced Security: By leveraging the expertise of an EMI, fiat funds are protected by advanced safeguarding measures, minimizing the risk of loss due to insolvency or operational failures.

2.Regulatory Compliance: EMIs operate under the supervision of regulatory bodies, ensuring adherence to stringent financial regulations. This compliance provides reassurance to clients and instills trust in the partnership.

3.Expertise in Digital Payments: EMIs specialize in electronic payment services, utilizing advanced technologies and infrastructure to facilitate seamless and secure transactions.

4.Efficient Fund Management: Partnering with an EMI streamlines the managing of fiat funds, as they have dedicated systems and procedures to handle payments, settlements, and reconciliations effectively.

Overall In today’s financial landscape, safeguarding fiat funds has become paramount. The partnership between WithMetis Markets and EMIs, like Modulr Finance B.V. and Intergiro Intl AB, offers a robust framework for protecting our and customers’ funds. Through strict adherence to regulatory requirements, segregation of funds, and additional capital provisions, EMIs provide a higher level of security than traditional banks. By embracing such partnerships, we can ensure the safety of funds, restore trust in financial systems, and provide our users with the peace of mind they deserve in their digital asset transactions.

Disclaimer: This article is provided for general informational purposes only and is not to be considered financial or investment advice. It is not intended to be a comprehensive guide and may not be suitable for your specific circumstances. You should not make any financial or investment decisions based solely on the information in this article. Consult with a qualified professional before making any such decisions. Your reliance on this article is at your own risk.