E-money institution or bank? What your neobank really is

An e-money institution is not a bank, and the difference shows up the day the institution fails. A licensed bank triggers a deposit guarantee scheme; an e-money institution merely safeguards your money. Here is what each status actually protects, and how to read your provider's licence in two minutes.

Neobank, online bank, e-money institution: three different things

"Neobank" is not a legal category. It is a marketing word, coined for branchless payment apps, and it now covers statuses that carry very different rights and duties.

Three statuses circulate in Europe. A credit institution — a bank — may take deposits from the public and grant credit; it is the only one that can. A payment institution executes payment transactions, with no deposits and no credit. An e-money institution does the same, plus the issuance of electronic money: the units stored on your balance in exchange for the euros you paid in.

An online bank, by contrast, is almost always a full credit institution. It just has no branches.

The confusion is not harmless. Using the word "bank" for an institution that lacks the licence is prohibited.

What is an e-money institution?

It is an institution licensed to issue electronic money and provide the related payment services, without ever taking deposits. In Belgium, its status and supervision come from the Law of 11 March 2018, with prudential oversight by the National Bank of Belgium — the country's prudential regulator.

The nuance sits in one word: safeguarding. When you transfer €2,000 to an e-money account, that money does not join the company's balance sheet. It is placed in dedicated accounts at a third-party bank, or in low-risk liquid assets, separately from the firm's own cash. The institution does not lend it, does not invest it on its own account, and earns no maturity transformation margin on it.

That is protective, and it is more fragile than a guarantee. The funds exist and are yours — but getting them back runs through a liquidation, with its delays and its costs, whereas a guarantee scheme repays on a timetable set by law. Nobody sends you an automatic transfer seven working days after the failure.

Licensed bank or e-money institution: what each status protects

The table below is the one thing worth keeping from this article. It compares the three statuses on what actually changes for you, in Belgium, as of writing.

Two points that are missing almost everywhere. The €100,000 guarantee applies per depositor and per institution, not per account: three accounts at the same institution do not add up to €300,000. And the €20,000 ceiling on financial instruments is not insurance against falling markets — it only steps in on a residual basis, when securities cannot be returned after inventory because of fraud or a serious administrative error. Your shares are not guaranteed in value. They are meant to be handed back to you.

The texts are available on EUR-Lex, and the Belgian regime is set out by the Guarantee Fund for financial services at the Federal Public Service Finance.

What status do Revolut, N26, bunq, Wise and Trade Republic actually hold?

Four of the five are licensed banks. The fifth is the one many Belgians assume is the most "local".

Statuses checked on 23 August 2026 against each institution's legal notices and the regulators' public lists. Legal structures change: verify before committing a significant amount.

The Wise case is the most counter-intuitive on the Belgian market, which is why it deserves its own paragraph. Wise Europe SA is licensed by the National Bank of Belgium under company number 0713.629.988, with a registered office on rue du Trône in Brussels. It is therefore the only one of these five supervised by our own regulator — and the only one covered by no deposit guarantee at all. Wise states it plainly in its safeguarding documentation: funds sit with third-party banks and in money market funds, separately from its own cash.

A friend insisted over dinner that his Wise account was "covered up to €100,000 like everywhere else". He was parking a five-figure freelance float there between invoices. He took it well when we opened the page together, but he moved the money on the Monday.

EU passporting: why your guarantee scheme is not Belgian

An institution licensed in one member state may operate across the entire European Economic Area without applying for a local licence. That is EU passporting, and it is the mechanism that makes pan-European neobanks possible in the first place.

Its consequence is rarely spelled out: the regime that covers you remains that of the home country. A Belgian client of Revolut depends on the Lithuanian scheme, a N26 client on the German one, a bunq client on the Dutch one. The EU directive harmonises both the €100,000 ceiling and the repayment deadline, so the gap in protection is small on paper.

What does change is the language of the procedure, the authority you have to approach in a dispute, and the time you will spend on it. Nothing dramatic. Just longer.

One exception is worth knowing: Aion Bank holds a Belgian banking licence, so it sits under the Belgian scheme and issues Belgian IBANs. Revolut, for its part, has run a Belgian branch since 2025 — which is how it began issuing IBANs starting with BE — but the banking licence itself remains Lithuanian. A branch does not move the licence.

I checked this on my own app, cross-referencing the Belgian company number of the branch with the entity named in the terms and conditions: two different identifiers, two different legal realities, and a Belgian IBAN that changes nothing about which guarantee scheme applies. Plenty of people understood the opposite when the switch happened.

How to check your neobank's licence yourself

In two minutes, free of charge, without asking anyone. The method comes down to five checkpoints.

• Find the exact legal entity name in the app's or the website's legal notices — not the commercial brand. "Wise" appears in no register; "Wise Europe SA" does.
• Search for it in the lists published by the National Bank of Belgium, which publishes credit institutions, payment institutions and e-money institutions separately.
• Look at which heading the institution falls under: licensed in Belgium, branch of a foreign institution, or operating under freedom to provide services from another member state.
• Check the licensing country if the institution is foreign, then that country's guarantee scheme. That is the one that would repay you.
• Consult the FSMA for investment and brokerage activities, which fall under a different licence and a different register from the payment account.

The checkpoint that sorts things fastest is the first one. I spent an evening running the exercise on the apps installed on my own phone, and out of seven, two showed their legal entity name nowhere in the app — you had to scroll to the bottom of the terms and conditions, in 8-point type, to find it. An institution that appears in no register at all does not deserve your money.

Are your securities protected the same way as your deposits?

No, and the regime is separate. In Belgium, the Guarantee Fund covers deposits up to €100,000 per person and per institution, and financial instruments up to €20,000 on top of that — so a client can recover a maximum of €120,000 from the same institution.

But the logic differs. Your securities are not the institution's property: they are registered in your name and held separately, and a bankruptcy does not make them disappear. The fund only steps in as a last resort, if securities are missing from the inventory.

This matters for anyone using an app that mixes payments and investing. Cash sitting on the account and shares held through the same app fall under neither the same mechanism nor the same ceiling, and sometimes not even the same legal entity within the group. Our comparison of neobanks for saving covers the returns; here we only look at what survives when the institution fails.

What this changes in your choice

Nothing, for a lot of people. Status only matters in proportion to how much you leave sitting there and for how long.

Below a few hundred euros of rolling balance, the debate is theoretical: a well-run e-money institution does the job perfectly well, often better than a bank on currency conversion and transfers. Above that, and especially for business cash or savings, the deposit guarantee changes the nature of the risk — and it costs nothing extra.

In short

Status is the first thing to know about a neobank, and the least advertised. A credit institution may take your deposits and opens the €100,000 per-depositor guarantee; an e-money institution safeguards your funds with no public guarantee. Revolut, N26, bunq and Trade Republic sit in the first category, each under its home-country regime; Wise Europe SA sits in the second, while being — paradoxically — the only one supervised by the National Bank of Belgium. You can verify all of this yourself, in two minutes, in the BNB and FSMA registers. For more on how repayment works, see our article on neobank deposit protection; on the friction of an account licensed abroad, see foreign IBANs in Belgium. To weigh up the offers, the comparison tool puts them side by side.

This article is general information about licensing statuses and protection mechanisms. It is not legal advice, investment advice, or a personalised recommendation.

Sources: Directive 2014/49/EU on deposit guarantee schemes (EUR-Lex); Directive 2014/65/EU (MiFID II); Belgian Law of 11 March 2018 on the status and supervision of payment institutions and electronic money institutions; National Bank of Belgium, lists of credit institutions, payment institutions and electronic money institutions; FSMA, registers of investment firms and intermediaries; Guarantee Fund for financial services (FPS Finance), ceilings of €100,000 for deposits and €20,000 for financial instruments; Wikifin (FSMA), new financial service providers; Wise documentation on safeguarding of funds at Wise Europe SA (company no. 0713.629.988); legal notices and terms of Revolut, N26, bunq, Trade Republic and Aion Bank consulted on 23 August 2026.