For several years now, the “”electrification”” of money flows in the context of large-value payment systems has been the focus of academic and institutional work because of the systemic risks posed by large-value national, pan-European and international exchange and settlement systems (Aglietta, 1996, Figuet et al., 1998). On the other hand, economic analyses of technological developments in retail payments have been little studied as if, a priori, these posed no serious problems except that of the efficiency of retail payment systems. However, in the current context of the application of information technology to retail payments, a particularly significant development seems to contradict this observation: electronic money.
Electronic money is conveyed through two new payment instruments: the electronic purse and the virtual purse. The purpose of the electronic purse is to automate payments of small amounts in local shops using a microprocessor card loaded with real electronic values which can be transferred directly between economic agents. This new payment instrument is designed as a substitute for coins and banknotes and aims to reduce the costs of collecting and storing coins. The direct applications of this new payment instrument concern vending machines, time-stampers, tolls, public payphones, etc.the principle of the virtual purse are much the same as the electronic purse except that electronic units are loaded onto a software-virtual purse-stored on the hard disk of the computer. The virtual purse then has as its object the payment of small amounts at a distance on the internet. These electronic values are then transmitted on the network for the settlement of financial obligations between internet users and e-merchants.
The specificities of these new payment instruments are at the origin of many economic works. The first series of studies is concerned with the economic qualification of electronic units (Piffarreti, 2000). For some authors, electronic units are a new form of money, called electronic money (Perdrix, 1994). For others, electronic units are only a new step in the process of electrifying scriptural money (Roberds, 1997). In addition to these initial works, there is a second series of contributions on the subject of the privilege of issuing electronic money by opposing the proponents of free electronic banking to those of banking centralism. In other words, can non-bank agents be allowed to issue these electronic units (Browne et al., 1995) or should the privilege of issuing electronic money be reserved for credit institutions (Godeffroy et al., 1999)? Finally, a final series of publications propose to formally assess the demand for electronic money (Boeschoten et al., 1996) and to analyze the monetary implications of the partial or total substitution of electronic money for cash (Berensten, 1998). For some authors, on the other hand, the development of a private substitute for legal tender should not affect the control of current monetary policy variables.
This article is part of the first series of works. Its purpose is to describe the specific features of the electronic purse to question the economic nature of the electronic units transmitted under this scheme. The central question we would like to answer is whether electronic money is only a “”second generation”” of dematerialized scriptural systems (Aglietta et al., 2002) or is it a real break and thus the advent of a new monetary form?
To address this issue, our work is organized in four parts. In the first part, we explain the principles and operation of electronic money systems through its main payment instrument, the electronic purse. In a second part, we seek to establish the specificities of the electronic purse in relation to traditional payment instruments. In a third part, we discuss the controversies surrounding the monetary classification of electronic units and provide some answers to assess the evolution of the monetary form. Finally, in a fourth part, we briefly present the functions of the new institutions in charge of electronic money and describe the French organisation of the issue of electronic money.