Interpretation of electronic money has both theoretical and practical importance for the current stage of development of the Kazakh economy, ensuring the effective functioning of settlement and payment systems, improving the mechanisms of monetary regulation and reducing risks.

Due to the wide variety of technological and organizational features of such commodity-money relations, the interpretation and definition of electronic money are equally multifaceted. E-money can be disclosed economically, legally, materially, materially, materially or technologically. If we look at e-money in terms of its physical form, it is a «file». From a legal point of view, electronic money is an issuer's perpetual monetary obligation to bearer in electronic form. In terms of their material form, electronic money provides information.

However, in this paper, the concept of electronic money will be disclosed only in the economic aspect.

The concept of electronic money among the author's interpretations is quite diverse. At the same time, one or another author (group of authors) chose as the main one the various elements that reveal the essence of electronic money. Depending on what was the main element of the interpretation of the concept of electronic money, we have identified the following approaches:

- formal;

- functional;

- issuing;

- infrastructural.

In terms of a formal approach, the concept of electronic money is disclosed through its form. This approach does not focus on the role and functions of money and the way it is issued.

Thus, O. Issing [4], H. Goadschalk and M. Kruger define electronic money as electronic storage of monetary value on a technical device that can be used to make payments not only to the issuer, but also to other entities.

The definition focuses on the form and method of storing monetary value. At the same time, the statement on electronic storage of value does not allow to fully disclose the essence of electronic money. In particular, non-cash funds are also stored electronically.

A similar viewpoint is held by B. Cohen, a professor at the University of California, in the article «Electronic Money – A New Day or an Imaginary Dawn» [5].

In it, he claims that electronic money is presented in two basic forms, smart cards and network money. Both of these options are based on the cryptographic protection of information, which is represented by a series of zeros and units, and can be transmitted and processed electronically.

Although the main advantage of this approach is the simplicity of interpretation, which consists in the definition of electronic money through formalities, the thesis of electronic storage of value is necessary, but not sufficient to understand the phenomenon of electronic money. Definitions in this approach do not reveal the role of electronic money in the money turnover. In our opinion, this is necessary to identify electronic money among other dematerialized means of exchange. In addition, the above interpretations do not allow us to determine what the monetary value is, or how the monetary value is issued.

The same approach should include the opinion of some authors (S. V. Afonina [8], V. A. Chelnokov, A. N. Sharov [9]), who connect the term «electronic money» only with bank cards. However, this interpretation is also incorrect, since bank cards are linked to a certain account. Bank cards, regardless of their type, do not allow the user to make payments bypassing the credit organization. Plastic bank cards are only the product of access to the bank account.

Ch. Friedman, the former Deputy Chairman of the Bank of Canada, formally classifies access devices, i.e. remote banking systems via telephone or computer, as electronic money [10]. A similar opinion is held by S. Sain, including electronic and telephone banking, debit and credit cards used via the Internet in the term «electronic money» [11].

However, there is a need to distinguish between electronic money products and so- called access products, which typically allow consumers to use electronic means of communication to access traditional payment services (e.g., using the Internet to make a payment using a credit card or to make a withdrawal, or to make general online banking transactions) [6]. Although similar, access products cannot be attributed to electronic money, as they do not have a monetary value, but are exclusively technical devices.

At the heart of the functional approach, e-money is defined by identifying with traditional money by its functions, but it is presented in a new form. That is, in addition to the formal features that characterize electronic money are added to the functional properties. The use of this approach is traditionally inherent in Russian scientists.

Researchers like V. M. Ussoskin, [7] A. C. Selishchev [8], G. N. Beloglazova understand the term «electronic money» as a general scheme of cashless settlements with the use of «money in a bank computer» sent via bank networks or managed by special technical devices. In the Modern Economic Dictionary of B. A. Raizberg, L. S. Lozovsky, and E. B. Starodubtsev e-money is a non-cash payment between sellers and buyers, banks and their clients, carried out by means of computer network, communication systems with the use of information coding and automatic processing [9].

However, in our opinion, it is wrong to identify electronic money with wire transfers of non-cash funds. In this case, only the workflow is electronically performed, as well as turnover of payment instruments (orders) for the transfer of non-cash money held in bank accounts. The non-cash credit money itself represents only a specific relationship between the bank and its clients. That is, the similarity between electronic forms of cashless money and electronic money is superficial. It consists of a digital form of data recording and the use of modern media on which it is recorded.

According to other scientists, electronic money is a new form of cash money. M. P. Berezina believes that «electronic money is an electronic analogue of cash in the form of a file recorded on a medium – computer hard drive or smart card» [10]. A similar opinion is held by C. B. Anureyev, arguing that the transfer of money from the payer directly to the recipient without the use of a bank account, as well as the presence of the transferred file of the so-called nominal value, is the basis for attributing electronic money to the type of cash [11].

Sh. P. Yeghiazaryan calls the file containing a number characterizing the amount of funds at the disposal of its owner, as well as other specialized information, electronic money. However, in the economic sense, the author means the banknotes issued by a credit institution in the form of information in the memory of the computer, which performs both the function of a means of payment and the means of circulation, as well as other functions of money, which have all the basic properties of traditional cash credit money (banknotes and small change coins), the process of payment of which is carried out by transferring (rewriting) them from the payer's computer to the recipient's computer, in other words, a new type of cash credit [12]. Thus defining the concept, S. P. Eghiazaryan identifies electronic and cash money.

Indeed, when considering electronic money and its property, you can see a lot in common with cash. First of all, electronic money does not possess the property of personification – there is no data on the amount of electronic money belonging to each user in the issuer's accounting. Secondly, in the process of functioning of electronic money there are exactly the same legal relations between the debtor and the creditor, as in the case of using cash, without an intermediary bank. That is, the monetary value is not debited from the payer's account and is not credited to the recipient's account. Third, when making payment transactions, the client is not identified or is identified if the amount of such transaction exceeds a certain amount.

However, there are significant differences between electronic money and cash. In cash payments, the monetary value is transferred only from the payer directly to the recipient of the funds. Electronic money allows you to participate in the calculations within the information and telecommunication networks, which makes it the most convenient option for the means of payment in the Internet, and in the mode of direct transfer of value from the payer's device to the recipient's device (especially with the use of NFC [13] and QR [14] technologies). In addition, e-money does not have a physical form as opposed to cash. Comparative characteristics of cash, electronic and non-cash payments are presented in table 1 [16].

 

Table 1 – Comparative characteristics of cash payments, with electronic and non-cash money

Feature	Cash in hand	Electronic money	Cashless money.
Client's bank account	Without opening a bank account		With the opening of a bank account
Availability	Direct customer involvement	Remote maintenance
Physical shape	Banknotes, coins	Payment cards, mobile phone, Internet
Self-contained treatment	Possible	Possible with restrictions	Impossible.
Need for identification when transferring funds	Depending on the amount		At the same time.
Cash insurance	Not provided for.		Provided for

 

Therefore, in our opinion, the correct statement will be the fact that electronic money is inherent in the properties of both cash and non-cash money: in addition to the above, they have the properties of stability, transferability, separability, timelessness, recognizability, durability, portability, privacy of payment and security.

Some scientists (O. I. Lavrushin, A. C. Gaiduk) consider electronic money together with cheques and promissory notes to be money surrogates or do not recognize it as an independent kind of money. Such a viewpoint is unlikely to be justified based on the current understanding of the nature of electronic money.

We agree with the opinion of the groups of authors (L. N. Krasavina, B. S. Aksyonov, E. V. Goryukov), who believe that electronic money is not money surrogates and not a modification of cash or non-cash money, but an economic phenomenon that represents a new form of money, because on the basis of electronic money operates a significant number of payment systems. It should also be noted that e-money, in our opinion, is not a substitute for cash or non-cash money, as the latter are still functioning in the monetary system when issuing e-money. In addition, they fully perform the function of the means of circulation, as well as the function of cost measure, when the price of many goods and services in Internet shops and Internet catalogues, price lists of Internet providers is expressed in electronic money.

The issuance approach assumes that the essence of electronic money is disclosed through a special procedure of its issue, different from the issue of banknotes and non-cash funds. According to D. A. Kochergin, the interpretation of the nature of electronic money should be based on the peculiarities of its issue. In this regard, considering the elements of the definition of electronic money, the scientist singles out, in addition to the monetary value defined as a repository of purchasing power, and a formal sign of the storage of this monetary value on an electronic device, other no less essential components: the prepaid nature of the cost and the multipurpose use [27].

E-money is a means of payment issued on the basis of funds received in advance. The amount of cash deposited as prepayment is equivalent to the amount of issued electronic money. Thus, the consumer pays for his purchasing power in advance, and the purchase of electronic money means the purchase of monetary value.

A special procedure for issuing electronic money is that it is issued on a prepaid basis, i.e. it represents a prepaid financial product. However, in this case there is a contradiction, which is as follows. If e-money has monetary value, it cannot be issued on a prepaid basis, and if it is issued on a prepaid basis, it cannot have monetary value, based on the toga, the monetary value is represented by traditional money placed in the accounts of the issuer [28].

The ambiguity of these definitions stems from the ambiguity of the relationship between value and electronic money. Since it is not possible to obtain electronic money as a monetary asset in an amount that exceeds the funds on which it is based (i.e., as a prepayment), it can be concluded that electronic money is a claim for funds deposited with the issuer. In other words, the traditional money received by the issuer does not currently mediate the relationship of «purchase and sale» of electronic value, and is a guarantee of the transaction.

However, the value issued on a prepaid basis will not be of a monetary nature if the issuer and the entity that is the exclusive recipient of this value will be the same. In other words, electronic money will turn into advances, a means of accounting for the consumption of own products.

Therefore, one of the most important properties of electronic money is the multipurpose use of value. This means that the holder of electronic money should be able to use it to purchase goods and services from a wide range of persons, primarily persons other than the issuer.

Thus, under this approach, electronic money is an electronically held monetary value, prepaid and used, including with respect to third parties that are not issuers.

Similar conclusions are reached by a group of authors (A. B. Pukhov, V. D. Dostov, A. A. Sobolev), highlighting the following criteria [20]:

- e-money is monetary liabilities of the issuer in electronic form, which are accounted for on a special device;

- the issue of electronic money is carried out after the issuer receives funds in the amount not less than the amount of obligations assumed by the issuer;

- e-money, from an economic point of view, is a multi-purpose means of payment;

- circulation of electronic money can occur bypassing the banking system, i.e. the transfer of electronic money is carried out directly from the device of one holder (payer) to the device of another holder (payment recipient).

At the same time, according to A. V. Shamrayev, electronic money should include not only those technologies in which settlements between the parties to the transaction can be carried out bypassing the banking system, but also those technologies, the mechanism of functioning of which implies the presence of final settlements between the parties to the transaction through the banking system.

We adhere to this opinion, however, it should be noted that settlements outside the banking system when using electronic money can be made only within the system of one and the same issuer. If the recipient of payment and the payer are served by different issuers (have electronic wallets opened with different issuers), there is a need to use bank payment instruments to complete settlements. Otherwise, payments cannot be made without using bank payment instruments. Thus, the need for settlements within the banking system arises only between different e-money issuers, but not between the recipient and the payer. In our opinion, this circumstance is necessary because it allows maintaining anonymity of transactions for the recipient and the payer.

The above elements of the definition of electronic money are sufficient and necessary to understand electronic money as a new means of payment and which distinguish it from other means of payment and instruments. In our opinion, a significant disadvantage of these definitions and interpretations is the refusal to disclose the peculiarities of electronic money functioning in them. It is advisable to include in the definition of electronic money theses characterizing the infrastructural aspect of the functioning of this means of payment.

Recently, new approaches to the disclosure of the concept of electronic money and the solution of the problem of infrastructure abstraction in their definition have begun to appear in domestic science. Within the framework of infrastructure, electronic money is disclosed not through its essence, but through its features and conditions of functioning.

Considering the concepts and functions of network money, A. A. Valinurova defined them as a type of electronic money, which is based on the predominant use of non-specialized telecommunications networks. The advantage of the definition is the introduction of the concept of «unspecialized network» - a computer network, the main purpose of which is not to conduct payments and settlements. This is an important element to disclose the characteristics of electronic money. According to A. A. Valinurova, network money is a special case of electronic money.

However, the peculiarities of electronic money functioning, being a more general concept than network money, in the infrastructural aspect are not limited only to the network. Electronic money without material content can be used only with technical devices when making payment transactions. At the same time, such devices can be multifunctional equipment (personal and tablet computers, mobile phones, flash drives) and specialized equipment (magnetic stripe cards, microchip cards, NFC tags). The choice of the device depends on the type of electronic money used, the level of technological development, as well as personal preferences of the user. In this regard, we believe that the criterion for using technical devices will be necessary and sufficient to define the concept of «electronic money».

Unlike the author's definitions, the concept of electronic money is considered quite broadly in legislative practice. In this case, it is problematic to identify certain approaches, as the definitions set forth in the regulatory legal act at the legislative level differ significantly from each other due to the level of development of technology for calculations, customs of making calculations, mentality and personal preferences of the population.

Electronic money in Japan is a stored value or prepaid electronic payment instrument for a multi-purpose purpose that requires a certain amount of funds to be deposited before use [20].

In the United States, for the purpose of regulating e-money at the state level, the Monetary Services Unification Act provides that e-money is a monetary value defined as a means of exchange, redeemable or not redeemable with money [21]. This definition does not indicate that electronic money is prepaid. However, regulations concerning the sphere of electronic money settlements in the United States do not require that they be prepaid.

The American approach does not consider e-money as a new form of money, but rather as a type of financial service. Thus, electronic money denotes a wide range of new payment instruments.

The U. S. and Japanese approaches define the concept of e-money to a greater extent from an institutional point of view, but it is not clear enough to reveal the essential points, namely properties and functions, for such an important category. In this regard, in our view, it is inappropriate to apply this interpretation in Kazakh practice.

In Europe, the concept of electronic money is defined by various organizations. Electronic money, according to the ECB, is interpreted as monetary value represented by a claim issued on a prepaid basis, stored in an electronic environment and accepted as a  means of payment by persons other than the issuer, intended primarily for transactions of small    value [22]. A similar view is taken by the Bank for International Settlements, defining e- money in the e-money survey as a stored value or prepaid product in which data on the funds or value available to the consumer for multi-purpose use are stored on an electronic device owned by the consumer. This definition includes prepaid cards (sometimes called e-wallets) and prepaid software products that use computer networks (sometimes  called digital cash, network money). In the case of card-based products, the prepaid price is  usually stored on a microprocessor chip embedded in a smart card. On the other hand, network products use specialized software installed on a standard personal computer to store the cost  [23].

The concept of electronic money, as defined in Directive 2009/11 of the European. Parliament and of the Council of 16 September 2009, defines the following: electronic money is an electronically stored value, including on a magnetic carrier, presented in the form of requirements to the issuer in monetary terms, emitted when receiving funds for payment transactions, and accepted by individuals or legal entities other than the issuer of electronic money [24].

The advantage of the European definitions is the indication of the value nature of electronic money, their difference from other payment instruments, and also emphasizes that electronic money circulates in an open system, that is, it has the property of general liquidity. These interpretations are complex and well developed.

In Russia, with the entry into force of the Federal Law of  27.06.2011 № 161-FZ «On the national payment system» there appeared a legal definition of this economic category. Thus, electronic money – money, which was previously provided by one person (the person who provided the money) to another person, taking into account the information on the amount of money provided without opening a bank account (the obliged person), to fulfill the monetary obligations of the person who provided the money to third parties, and in respect of which the person who provided the money has the right to transmit orders only with using electronic means of payment. An electronic means of payment is a means and (or) a method that allows a client of an operator to make, certify and transfer orders for the purpose of transferring funds within the framework of applicable forms of cashless settlements using information and communication technologies, electronic data carriers, including payment cards, and other technical devices. That is, electronic means of payment are technical devices and ways to work with electronic money.

The mention of an electronic means of payment, in our opinion, is an advantage of this definition, as it is necessary for the disclosure of the term from an infrastructural point of view.

However, the actions with electronic money are limited to non-cash payment forms, which indirectly confirms the identification of electronic money and non-cash money transfers.

Obviously, this legislator wanted to emphasize the main purpose of electronic money – to be a means of calculation (payment), thereby building a definition on one of the functions of money. However, to define the concept of electronic money it is necessary and sufficient to specify their attributes, while the numerous functions of money can perform due to the presence of an attributive property.

In other words, in accordance with the Law, the concept of electronic money is reduced to the process of depositing funds to the account in settlements, divided in space and time (both through the cash desk of the credit organization, and in non-cash order) and non-cash transfer of funds without opening a bank account through electronic technical devices of remote access.

In addition, the definition does not specify the process and procedure for issuing electronic money.

It is quite controversial that electronic money will only include funds that have been received directly by the person providing the money and can be used to meet the cash obligations of that person. Thus, the definition does not apply to monetary value,

received as payment for services rendered or goods delivered. The definition proposed in the Act is therefore overburdened with additional conditions and does not cover all possible situations.

The definition uses the concept of cash, which in our opinion is an accounting and legal term. Therefore, this interpretation does not allow us to identify the essence of electronic money in the economic aspect. Also, the concept of electronic money contains a logical error, expressed in the so-called vicious circle, when the definition of electronic money is disclosed using the concept of money.

Taking into account the studied points of view on the issue of theoretical identification of the concept of electronic money, taking into account the peculiarities of all interpretations, it is possible to identify the properties (attributes) and their groups that characterize electronic money:

а) formal properties:

1) have a conditionally dematerialized form;

2) have an impersonal character of ownership;

b) functional properties:

1) the main function is to be a means of exchange;

2) are able to perform other functions of money;

c) emission properties:

1) are presented in the form of requirements to the issuer;

2) are issued in an amount not exceeding the amount of money deposited in advance;

3) there is no binding to the bank account;

Infrastructural properties:

- are used in the open system (accepted by persons other than the issuer);

- monetary value is stored on a technical device.

However, the definition of e-money should not be based on all of the features identified above, but only on those that are intrinsic to e-money, i.e. internal, inherent properties of e-money. These, in our opinion, include formal, emission and infrastructural properties. Functional properties of electronic money are conditioned, first of all, by their nature, have secondary character and cannot be a basis for theoretical identification of this category.

In addition, we recognize that e-money, being a monetary value, has a purchasing power that is determined by the amount of demand on the issuer. Speaking of electronic money, it is necessary to understand that it has a conditionally dematerialized form, as it cannot function without any technical device.

Thus, electronic money – dematerialized unit of purchasing power, which is issued on a prepaid basis, is accepted by persons other than the issuer, and its settlement does not require the exclusive and mandatory use of bank payment instruments.

The advantage of the above definition of electronic money is that it includes immanent attributes in a comprehensive manner and allows for the reliable identification of electronic money among other means of circulation. In addition, the definition does not limit the scope of the concept only to the monetary value issued by credit institutions, and also includes the value issued by organizations that are not credit institutions. In our opinion, the attribute defining the type of electronic money issuer is external, does not define the nature of electronic money and should not be included in the definition of the concept, but should be determined by the relevant regulations.

This criterion is necessary because the prepaid cash value can be issued by both credit and noncredit institutions. In both cases, the monetary value may be accepted by persons other than the issuer, which allows the value to be recognized as electronic money. Therefore, electronic money should be divided into two types: those issued by credit institutions and those issued by entities other than credit institutions. This distinction is key because it determines the nature of the impact of the spread of certain types of electronic money on the money supply and determines the principles, methods and tools of supervision of the relevant organizations.

In order to better identify electronic money among other concepts, which are often interchangeable in the economic literature, it is necessary to identify differences from these concepts. Taking into account the fact that e-money can be issued by organizations other than credit organizations, it is necessary to draw a clear line between the so-called bonus programs issued by large trade operators, including in cooperation with each other, and e-money itself. Thus, Cohen notes that the development of «gift money» is potentially a phenomenon dangerous to the monopoly of central banks. Customers receive these funds not after prepayment, but as a reward for purchasing goods and services. Similar models are available for air and rail carriers in the form of so-called «bonus miles», as well as for retail fuel market operators. Although these bonuses may be stored in a manner similar to electronic money on a technical device or network within a customer account, they may not be spent solely on the acquisition of benefits from the entity that provided the bonuses, but they cannot be considered electronic money. These funds do not represent a monetary value, but a quantitative measure of the loyalty discount granted or accumulated.

Our analysis allowed us to identify the most significant immanent and transcendent attributes of the concept and on their basis to form a definition of electronic money. The usefulness and value of the method we use is to form a holistic view of how the many research aspects of e-money disclosure fit together.