ADON legal assisted Protean Risk Limited (a registered Lloyds broker) in adapting the PSD Bond to the Lithuanian laws and coordinating it with the Bank of Lithuania. PSD Bond is an insurance product for the safeguarding of clients’ funds of electronic money institutions (EMIs) and payment institutions (PIs).
PSD Bond is the first insurance contract that meets the requirements of the PSD2. Deploying PSD Bond as an alternative or complementary method of safeguarding delivers multiple benefits to PIs and EMIs including reducing their risk and the costs of capital associated with safeguarding client funds in segregated accounts.
”The safeguarding requirements have recently been in the spotlight of the Bank of Lithuania – several market participants were sanctioned for non-compliance, the public consultation on the improvement of means of safeguarding was also carried out. We consider the introduction of the PSD Bond to be an important development for Lithuanian EMIs and PIs giving additional means to meet the regulatory expectations.” says Donatas Šliora of ADON legal.