Agent vs distributor — the line EMIs keep crossing
There is one sentence in EU law that settles most of the confusion: electronic money institutions shall not issue electronic money through agents. Article 3(5) of Directive 2009/110/EC says it flatly. Agents and distributors are different creatures doing different things under different provisions, and an e-money distribution network built on agent notifications is built on the wrong instrument.
1. Agents — PSD2 Article 19
Where a payment institution intends to provide payment services through an agent, it must communicate to the competent authorities in its home Member State:
- the agent’s name and address;
- a description of the internal control mechanisms the agent will use to comply with AML/CFT obligations, to be updated without delay on material changes to what was notified;
- the identity of directors and persons responsible for the management of the agent, and — for agents that are not themselves payment service providers — evidence that they are fit and proper;
- the payment services for which the agent is mandated;
- where applicable, the agent’s unique identification code or number.
The competent authorities then act within the period the article sets — Article 19(2) opens with a two-month window from receipt. The agent is listed in the public register, and the services the agent may provide are bounded by what was notified.
2. Distributors — EMD2 Article 3(4)
Member States must allow electronic money institutions to distribute and redeem electronic money through natural or legal persons acting on their behalf. Where an EMI distributes e-money in another Member State by engaging such a person, PSD2 Articles 27 to 31 — with the exception of Article 29(4) and (5) — apply mutatis mutandis.
3. The comparison, in one table
| Agent | Distributor | |
|---|---|---|
| Anchor | PSD2 Article 19 | EMD2 Article 3(4) |
| May do | Provide payment services for which mandated | Distribute and redeem electronic money |
| May not do | — | Issue electronic money |
| Available to an EMI? | Yes, for payment services under Article 6(1)(a) EMD2, subject to PSD2 Article 19 | Yes |
| Cross-border route | The PSD2 passporting procedure | PSD2 Articles 27–31 mutatis mutandis, excluding Article 29(4) and (5) |
So an EMI can hold both relationships at once, and many do: a distributor network for the e-money product and an agent network for the payment services it also provides. What it cannot do is collapse them into one notification type.
4. Both are inside the AML perimeter
Whichever instrument is used, the network is not outside the compliance boundary. Article 73 of Regulation (EU) 2024/1624 binds agents and distributors by name to the tipping-off prohibition, and Article 12 requires the awareness and training measures to reach agents and distributors expressly. Network training material is therefore a regulatory artefact, and the AML control description that goes into an Article 19 agent notification has to describe something that actually exists.
FAQ
Can an EMI issue e-money through an agent?
No. Article 3(5) of Directive 2009/110/EC prohibits it outright. EMIs may provide payment services through agents under PSD2 Article 19, and may distribute and redeem e-money through persons acting on their behalf under Article 3(4).
Does a distributor have to be notified?
Where the EMI distributes e-money in another Member State through such a person, PSD2 Articles 27 to 31 apply mutatis mutandis, with the exception of Article 29(4) and (5) — so the cross-border notification machinery engages.
Are agents and distributors covered by AML obligations?
Yes. They are named expressly in the AMLR tipping-off prohibition and in the awareness and training duty, and an agent notification must describe the AML internal control mechanisms the agent will use.
Related: Agents, distributors and the register · PSD2 passporting · Tipping-off
