LeuPay.EU - Review please is it a good offshore bank?

[David97255]

Note that EMIs are obligated via regulation to keep 100% of their customers' money in zero-risk accounts (e.g. an interest bearing bank savings account). Unlike banks, EMIs can't use that money to lend, leverage, provide credit, or make risky investments. So, in theory, if regulations are followed (and for the majority they are certainly followed) your money is very safe.

A doomsday scenario would be a collapse of one or more of the banks providing accounts to the EMI. As in, a backbone failure. It's an unlikely scenario, and they certainly try to mitigate those risks by working with several large providers.

Then there's the risk of the EMI deciding that they don't want you as a customer anymore. This can happen with any financial institution, and they will not keep your money if this happens, unless instructed to by law/tax agencies.

Does it make it safe?
At my opinion no .
There will be bankruptcy with emi's , it's after all private companies.
And then ....you will not find your money in any segregated bank account.
I use emi's like layers... Not like safe box

 

[Nyep]

There will be bankruptcy with emi's , it's after all private companies.

These are pretty heavily regulated private companies. Bankruptcies cannot affect customers' money if regulations are followed. Money in customers' accounts cannot be used for running the company, paying salaries, or paying creditors in case of bankruptcy. It's not the EMI's money, unlike with banks.

If regulations are not followed then the EMI will lose its license very quickly. That's a non-option for them.

 

[David97255]

Not agree with you.. I guess we don't see this world in same way, not a big deal.
Let's take the last example... Choice bank where is the customers money?

 

[Martin Everson]

Theory and reality are two different things unfortunately. EMI's are not safe as they appear.

Most EMI's have to hold a client pooled account with a third-party bank. Most EMI's hold an account labelled a 'Safeguarding Account' or similar at a licensed bank i.e Revoult uses Lloyds and Transferwise uses LHV and a German bank etc. The myth is that an EMI can never lose your money due to safe guarding and requirement to keep a 1:1 ratio between e-money and clients fund. The truth is the EU does not require 100% of clients funds to be deposited in an account. In Lithuania they allows e-money issuers to have less than the deposited amount provided any unfunded liabilities are safeguarded by private insurance .

Also for funds to be safe where 100% is kept on deposit at a bank the funds must be able to survive the holding banks bankruptcy and the EMI's bankruptcy also. While a bank in the EU has individual client deposit insurance the safeguarding account of an EMI at a bank does not have this.

In the event the holding bank goes bankrupt for example Deutsche Bank, the individual clients funds in the EMI account are non identifiable by DB as they are aggregated. So if the account held 200m euros a one off EU 100k deposit insurance would be paid over the total funds. Furthermore in the UK balances of FI's are not covered by deposit insurance . Unless client EMI assets are held in trust or custodial form at a bank your assets are gone in bankruptcy. You see segregation of client funds and protection against insolvency are two totally different things. Any EMI can put all client money in a separate account at a bank and call it segregated to fulfill EU e-money regulations but is it properly protected against the holding banks bankruptcy and are they using the right account arrangement?

I would love to know if my understanding in this area is correct. Feel free to correct me....thx.

 

[Suzy Emerald]

An example to illustrate Martin Everson's explanation could be Worldcore that held their client funds with Rietumu

 

[Nyep]

Let's take the last example... Choice bank where is the customers money?

Choice bank was a bank, not an EMI, that's the point. They used deposits for running the bank, for leveraging, and for failed credit schemes, which were too risky and killed them. EMIs can't do that.

In Lithuania they allows e-money issuers to have less than the deposited amount provided any unfunded liabilities are safeguarded by private insurance .

If any used money is 100% insured then it's as good as being there. Well, almost.

Also for funds to be safe where 100% is kept on deposit at a bank the funds must be able to survive the holding banks bankruptcy

Yes, I addressed that scenario in my original post. A doomsday scenario where the backbone fails is possible, but mitigated in different ways by the big EMIs. It basically comes down to whether you trust the EMI's backbone not to fail, because the EMI failing should not affect you. In other words, do your EMI backbone research and allocate risk accordingly - if you discover a weak backbone such as Rietumu, either run away or never keep large sums laying around.

 

[Xireyh]

Apart from the monthly 10 Eur administration fee the other fees seem reasonable at Paysera. Paysera in the end have to start making money to stay in business like all EMI's.

Leopay I use it to for small transactions and but don't keep any money in any EMI for more than 48hrs. 100k is a lot to keep in an EMI with no deposit insurance. If you don't need all of the 100k for daily activity park the excess money in a bank with deposit insurance or use multiply EMI's i.e MisterTango etc if EMI's are your preference.

Good idea about the different EMIs. Many thanks. For me parking money in a bank is loosing it I'm thinking about they best way to invest it.

 

[Mark Rucken]

A bit off topic, but is everything okay with outgoing transfers with LeoPay? Is it possible to make a transfer at the moment?

 

[Martin Everson]

A bit off topic, but is everything okay with outgoing transfers with LeoPay? Is it possible to make a transfer at the moment?

You noticed something?

 

[Mark Rucken]

You noticed something?

My client, who is supposed to pay for my services, using LeoPay account, has informed me outgoing payments are down and that they have told him everything should be OK in 2-3 days ... so I want to check whether he is making it up or LeoPay is indeed experiencing problems

 

[David97255]

My client, who is supposed to pay for my services, using LeoPay account, has informed me outgoing payments are down and that they have told him everything should be OK in 2-3 days ... so I want to check whether he is making it up or LeoPay is indeed experiencing problems

I made a payment on last Thursday morning, money was directly debited from the account. Right now was on phone with the supplier still didn't receive the money.. it s longer than usual. Will send an email and update here if I got any answer.

 

[Michael Arris]

Leupay is not a good solution, I have quite lot of experience with it and can not recommend.
Better is paysera(dot)com, very good services and really cheap. But they do CRS reporting. Another one also good erabanq(dot)com, bit more expensive but no CRS reporting, great privacy for individuals and offshore companies. Also good choice couple years ago was europacbank(dot)com but last year or two it sucks and it became very dangerous because of poor regulation

 

[JohnLocke]

Please open a new thread to discuss other EMI's or I will have to delete some posts here!

 

[Mark Rucken]

I made a payment on last Thursday morning, money was directly debited from the account. Right now was on phone with the supplier still didn't receive the money.. it s longer than usual. Will send an email and update here if I got any answer.

Update:
I have received the funds, LeoPay is working, took them a bit longer, but the funds are on the account

 

[Xireyh]

I have a little mess with LeoPay fees...could you help me, please?

There are like 2 different fees: the public one below and the one you get once you open an account - please, find it attached.

Leopay FEES

Sending SEPA transfers cost 3 € but receiving SEPA transfers from clients...is it free or 1.000% + 0.10 EUR?

The charge 0,10 € for SMS notification...which kind of notification?


Many thanks in advance!

 

[Xireyh]

I have a little mess with LeoPay fees...could you help me, please?

There are like 2 different fees: the public one below and the one you get once you open an account - please, find it attached -:

Terms & Conditions - Legal Agreement for LeoPay Services


Sending SEPA transfers cost 3 €.
Pay for services and goods to other account is free of charge.
If I send payments as SEPA transfers (I think there is no other way within Europe except the card), which one aplies?

On the other hand...receiving SEPA transfers from clients... is free or 1.000% + 0.10 EUR?

The charge 0,10 € for SMS notification...which kind of notification?


Many thanks in advance!

 

[Mark Rucken]

Someone on here complained how LeuPay blocked their account for no reason and is keeping the funds frozen for months. I kinda thought that was BS, but now it happened to me. They randomly blocked an account that has around 50k turnover over a 60 EUR payment. I have provided them with an invoice and they are reviewing the "payment of 60 EUR" for 2 weeks now and the account is currently blocked. When you call them, they keep repeating the same thing and say someone will write you an email. 10 minutes later you get an automatic reply they send to everyone by default.

 

[DeepDrilling]

after to be a customer for over a year they finally shut down my account froze all funds and never replied to my e-mails! I tried calling them endless times never got anything back from them.

 

[Mark Rucken]

after to be a customer for over a year they finally shut down my account froze all funds and never replied to my e-mails! I tried calling them endless times never got anything back from them.

What happened with the funds on the account?

If they never returned the funds they froze ... well that is shocking that one "serious" EMI would randomly keep the funds you had on the account. If you are not satisfied with your client, return the funds and close the account. I wonder what will happen with my funds, jeez.

 

[Xireyh]

I opened an account with LeoPay just a week ago and they asked me for some documents I have no problem to upload them but before I asked them some doubts answering their email and didn't get any answer after a week. What could I expect in the future from an EMI which now doesn't answer normal questions / doubts from an almost new client (I have the account but cannot do anything with it)? I don't want to know being a formal client with money there...