Is Viva Wallet a Bank

Viva Wallet has become a well-known name in the world of digital payments and ecommerce, offering businesses a convenient way to manage money and accept payments. However, one of the most common questions asked by new users is whether Viva Wallet is an actual bank. The simple answer is no. Viva Wallet is not a traditional bank but an electronic money institution, often referred to as an EMI.

This distinction is important for business owners to understand because it affects how their funds are held, regulated and protected. Viva Wallet operates legally and securely, but it follows a different regulatory model from that of a traditional bank.

Viva Wallet’s Regulatory Status

In the United Kingdom, Viva Wallet is authorised and regulated by the Financial Conduct Authority (FCA) as an electronic money institution. This authorisation allows the company to issue electronic money, provide payment accounts, process transactions and offer card payment services.

As an EMI, Viva Wallet can perform many of the same functions as a bank in terms of handling money transfers and providing accounts. However, it cannot legally accept deposits in the same way a bank can, nor can it offer traditional banking products like overdrafts, loans or savings accounts.

The company must follow strict regulations that ensure customer funds are safeguarded. This means that money held in a Viva Wallet account is kept separate from the company’s own operational funds. In other words, the funds cannot be used by Viva Wallet for its own business activities, which provides protection against misuse.

What Being an Electronic Money Institution Means

Being an EMI means that Viva Wallet provides digital payment and money management services without being classified as a bank. The main difference lies in how customer funds are handled and protected.

When you deposit money into a bank account, those funds are typically covered by a government-backed deposit protection scheme such as the Financial Services Compensation Scheme (FSCS) in the UK. This scheme protects customer deposits up to a certain limit if a bank fails.

In contrast, funds held in a Viva Wallet account are safeguarded but not protected under the FSCS. Instead, Viva Wallet is required by law to hold all customer funds in separate accounts with reputable financial institutions. These funds are ring-fenced and cannot be accessed by Viva Wallet for any other purpose.

This structure provides a strong layer of security, though it operates differently from traditional deposit protection. Customers can still trust that their money is secure, but they should understand the difference in legal status.

How Viva Wallet Operates

Viva Wallet provides a range of services that are similar to those offered by banks. It issues business accounts with unique IBANs, allowing companies to send and receive payments. It also offers physical and virtual business debit cards for everyday expenses, alongside online payment solutions for ecommerce.

The Viva Wallet system allows businesses to manage payments, transfers and financial reporting all in one place. Funds received from sales or payments go directly into the Viva Wallet account, which can then be used to make purchases, pay suppliers or transfer to other accounts.

From a functional perspective, this is very similar to how a business bank account operates. The key difference is that Viva Wallet does not provide credit facilities, interest-bearing savings or government-backed deposit insurance.

The Relationship Between Viva Wallet and Traditional Banks

Even though Viva Wallet is not a bank, it works closely with banking partners to deliver its services. When customers open an account, their funds are safeguarded through reputable financial institutions that meet regulatory standards.

This partnership approach allows Viva Wallet to focus on providing cutting-edge payment technology while relying on established banks to hold customer funds securely. It is a common model among fintech companies and electronic money institutions operating in Europe and the UK.

In practice, Viva Wallet serves as the interface for businesses to manage their transactions, while the underlying accounts holding the money are maintained through regulated banking partners.

Why Viva Wallet Isn’t Classified as a Bank

A company can only be called a bank if it holds a full banking licence. This licence permits activities such as accepting deposits, issuing loans and operating savings accounts. Viva Wallet does not hold this type of licence in the UK.

Instead, it operates under an electronic money institution licence, which allows it to issue and manage digital funds but not to lend or take deposits in the same way a traditional bank does. This distinction ensures transparency and sets clear expectations for customers about the services Viva Wallet provides.

Does Viva Wallet Offer the Same Security as a Bank?

While Viva Wallet is not a bank, it is still subject to strict financial regulations designed to protect customer funds. Safeguarding rules require all client money to be kept separate from company accounts, meaning that even in the unlikely event of insolvency, customer funds should remain protected.

The absence of deposit insurance like the FSCS does not make Viva Wallet unsafe. It simply means the protection structure is different. Instead of relying on a compensation scheme, customer funds are held securely in designated accounts that are monitored under financial regulations.

Is Viva Wallet Safe for Businesses?

Yes, Viva Wallet is safe to use for business transactions and payment processing. It is regulated by financial authorities, complies with European and UK standards, and uses advanced security technology to protect data and transactions.

Its electronic money licence requires it to follow rigorous procedures for safeguarding funds, anti-money laundering compliance and data protection. Viva Wallet is also compliant with the Payment Services Directive 2 (PSD2), which governs electronic payments in Europe.

For ecommerce businesses and retailers, this makes Viva Wallet a trusted solution for handling payments. It combines regulatory compliance with convenience, allowing merchants to manage payments, accounts and cards in one secure platform.

The European Banking Connection

Although Viva Wallet is not a bank in the UK, the company’s wider group operates under a different structure in Europe. The parent organisation in Greece has acquired a banking licence through its ownership of a Greek bank, which allows it to offer broader financial services in some countries.

However, this does not automatically make the UK entity a bank. Each jurisdiction has its own regulatory framework, and in the UK, Viva Wallet continues to operate strictly as an electronic money institution.

Conclusion

Viva Wallet is not a bank but an electronic money institution that provides business accounts, payment processing and card services. It operates under full regulatory supervision and safeguards customer funds according to financial standards.

For businesses, Viva Wallet offers many of the benefits of a bank, including secure account management and flexible payment options, without providing traditional banking products such as loans or deposit protection. Understanding this distinction helps businesses make informed decisions about how to use Viva Wallet alongside other financial services.

It is a reliable and secure solution for managing digital payments and transactions, but it should be viewed as a payment and account platform rather than a conventional bank.