It is common to distinguish between two forms that provide different solutions for this: A defined-benefit pension scheme is an agreement to pay a specified benefit amount irrespective of the return on the premiums paid in. The benefit can be adjusted for inflation, wages or the like. Premium payments can be changed as a result of demographic changes such as higher life expectancy, but not as a result of lower returns. A fall in returns must be covered by the company or entity if they have their own pension funds. Pensioners are secure under municipal defined-benefit based pension schemes, while municipal service production must absorb the impact of lower returns. National Local Government Pension Fund - premiums and financial income 1994-2001. In billions of NOK  16 14 12  Net financial income  10  Premium income  8 6 4 2 0 -2  1994  1995  1996  1997  1998  1999  2000  2001  SG Kommunalbanken, 30.august 2002  In recent years, municipalities have noticed this additional burden as owners of the National Local Government Pension Fund. However, high returns restrained the rise in premium income towards the end of the 1990s. The alternative to a defined-benefit pension scheme is a defined-contribution pension scheme. The defined-contribution pension plan is a programme under which members decide how pension savings are invested. Future benefits depend on the return. It can be agreed that the pension payments are to be fixed.

Using digital technologies, they try to redefine the provision of financial services to improve customer experience and to find their place on this highly competitive market. These new players position themselves mostly in market niches with a potential for further development. Such niches are, for example, the digital wallets, person-to-person (P2P) and business-to-business (B2B) payments, as well as value added services offered on the basis of existing traditional payment services. With the Second Payment Services Directive (PSD 2), two new types of electronic payment services were regulated in the European Union – payment initiation services and account information services. These new services are already offered in Bulgaria and provide technological basis for the implementation of the so-called ‘open banking’. It enables FinTech companies to enter the payment market more easily by introducing new business models, services and solutions. Examples for such services are aggregation of payment account data from different payment service providers, carrying out financial analysis, initiating payments from accounts held with other payment service providers, etc. Security of electronic payments remains in the focus of the European and Bulgarian regulators. Increased use of electronic payments and the recent boom in e-commerce pose new challenges with respect to protecting security of payments and electronic identity of customers. The most significant progress here was made in 2019 when the Europe-wide obligation for strong customer authentication was introduced. For this purpose, at least two independent elements of different categories must be used (knowledge, possession and inherence) when processing electronically initiated payments.