# What are the legal and payment scheme rules for launching a prepaid card program without KYC?

Recently we have been asked the question: “What are the options for a merchant or cafeteria to launch a **card program** based on **prepaid cards** (such as **lunch cards and gift cards**) that doesn't require a [**KYC process**](https://developer.verestro.com/books/knowledge-center/page/kyc-and-kyb-requirements-in-card-issuing)?”

There are a lot of misleading pieces of data regarding prepaid cards and gift cards. Those issues are mainly caused by differences between the legal environment and [**Mastercard or VISA**](https://developer.verestro.com/books/knowledge-center/page/visa-or-mastercard) rules. In this article we would like to go deeper into this topic and explain what is possible and what is not possible.

### Key regulatory and scheme requirements for prepaid card programs

##### Let’s start with key rules:

1\. **PSD2** (legal environment in Europe) and **AML** law say that payment institutions have to know their customers so full KYC must apply. Sometimes, depending on the country, some limited KYC rules are possible in case a payment institution issues a payment instrument with payment or transaction limits i.e. non-reloadable gift cards. We work in compliance with the Polish law which states that it is possible to issue anonymous cards only in case:

a. Value of monthly transactions is limited to 150 EUR

b. Value of such card is limited to 150 EUR

c. Only POS and eCommerce transactions are allowed

2\. **Mastercard and VISA rules** claim that in case of specific non-reloadable prepaid cards it is possible to issue anonymous cards. It requires special approval for the program.

3\. In some specific use cases ([**expense management**](https://developer.verestro.com/books/knowledge-center/page/what-employee-benefits-can-be-offered-via-the-verestro-business-control), lunch cards) it is possible to perform KYB of the company selling prepaid cards only. In such a case money on account must belong to the company and the company can issue such cards with limited KYC to its employees or users.

### Implementing reloadable and non-reloadable gift cards

Taking the above rules into account, we can imagine the following scenarios:

##### Scenario 1 – non-reloadable gift cards with limits up to 150 EUR with limited acceptance

It is possible to [**issue cards**](https://developer.verestro.com/shelves/core-system) for such programs after approval of the payment scheme.

##### Scenario 2 – reloadable gift cards for the company and its business expenses

It is possible to sell **gift cards connected to the business account** of the company (after KYB) assuming payments are connected with expenses or specific use cases of this company.

Please [**contact us**](https://www.verestro.com) if you want to issue similar programs with simplified KYC rules. We will advise on the best scenario and try to find ways to **quickly launch a prepaid card program** that meets your business needs.