The objective of this article is to present the main issues related to electronic money. The article presents general characteristics of electronic money appearing in two forms, namely the electronic purse and the network based product. Furthermore, the article includes a comparative analysis of electronic money and cash as well as other payment instruments such as traditional payment cards and prepaid cards. The article also discusses the development of electronic money around the world, its main functions and application. It also includes examples of how electronic money in the form of the electronic purse was introduced in countries like Belgium, France, Hong Kong and Singapore. The author presents his views on further development of electronic money around the world and points out the factors that should be, in his opinion, taken into consideration when launching this product on the Polish market.