Payments
Danish Ombudsman fines NightPay over e-money redemption failures
Danish e-money issuers running legacy app infrastructure now face two distinct control obligations — redemption mechanics and pre-closure notice — after the Ombudsman's April 2026 precedent crystallises both as separately enforceable duties.
2026-04-28 · 1 min
Danish Ombudsman fines NightPay over e-money redemption failures
Background
The Forbrugerombudsmanden imposed a DKK 100,000 administrative penalty on NightPay on 13 April 2026 under section 166 of the Danish Payments Act, the national transposition of EMD2 Directive 2009/110/EC, Art. 11 and the in-force PSD2 framework now being supplanted by PSD3.
The two breaches
The sanction concerns two legally distinct breaches. The Ombudsman classified NightPay's stored consumer balances as electronic money and found the firm had failed to honour the redemption obligation that attaches to e-money under the Payments Act — a substantive breach of the redemption right itself, independent of how the firm wound down its product.
The second breach is procedural. Before discontinuing its legacy app, NightPay did not give holders of outstanding balances adequate advance notice, a separate disclosure obligation under the same statute. Both findings sit under section 166.
In a statement on the decision, the Ombudsman's office said the action was "intended to clarify the payments rules for the firm." No formal industry reaction had surfaced at publication. Source: Forbrugerombudsmanden press release, 13 April 2026, forbrugerombudsmanden.dk
Cross-border read-across
The supranational lineage matters for issuers reading across borders. EMD2 article 11 mandates redemption at par on demand; PSD3, tabled by DG FISMA and now in national-transposition phase to December 2026, carries the redemption architecture forward with tightened wind-down disclosure. The EBA Q&A on redemption obligations EBA Q&A 20184085 remains the operative interpretive layer.
Operational implications for Danish-licensed issuers
The operational read for Danish-licensed e-money issuers running legacy app infrastructure is narrow but specific. Any product-discontinuation playbook should be re-papered against two separate control points:
- Redemption mechanics — confirm par-value redemption is honoured at the point of product closure
- Pre-closure notice — document a holder-communication window of no less than 30 days
A mid-sized issuer should expect 40–80 hours of legal-review time to refresh the playbook against the NightPay precedent.