01
The FCA category starts with the product and complete funds flow
Map users, contracts, wallets and accounts, entitlement to funds, settlement, refunds, fees, currencies, cards, acquiring, transfers, PIS and AIS. Functions are then tested against the Payment Services Regulations 2017, Electronic Money Regulations 2011, exclusions and any FSMA perimeter. Fintech, wallet or platform labels do not determine authorisation, and a technology intermediary may become regulated because of its real control over a payment.
02
API, SPI, AEMI, SEMI and RAISP are not interchangeable
An authorised payment institution provides permitted payment services; small payment institution registration is available only within its conditions. An authorised electronic money institution issues e-money and may obtain related payment permissions; a small EMI has its own thresholds and restrictions, including no PIS or AIS. A RAISP concerns account information service. Choosing a smaller category without meeting its conditions creates regulatory risk, while a banking licence is a separate regime.
03
The application must evidence a ready, willing and organised business
The FCA expects one coherent file: programme of operations, business plan and financial model, ownership and controllers, governance, directors and senior management, safeguarding, AML/CFT, security, operational resilience, outsourcing, complaints, incidents, reporting and wind-down. Documents should describe an operating system already designed, not future promises. A complete payments or e-money application is normally assessed within three months; an incomplete one may take up to twelve, and regulator questions are a normal part of review.
04
Safeguarding protects relevant funds but does not turn an EMI into a bank
Payment and e-money firms protect relevant funds under the applicable PSRs or EMRs and FCA rules. From 7 May 2026, the supplementary regime strengthens reconciliations, governance, third parties, records, resolution packs, audits and monthly reporting. The precise method, safeguarding account or eligible insurance or guarantee model is designed before launch. Customer money at an EMI should not be marketed as a bank deposit or with protections that do not apply.
A UK EMI or payment institution is built around the real payment product and customer-money flow. Incorporating a company does not authorise e-money issuance, transfers, acquiring, payment initiation or account information: define the FCA perimeter first, then build capital, governance, safeguarding, AML and technology.
05
Capital, liquidity and wind-down follow the business model
The regulatory minimum is only a starting point. The model aligns initial and ongoing capital, fixed overheads, transaction volumes, safeguarding exposures, fraud and operational loss, insurance, technology, staff and outsourcing, liquidity and wind-down costs. Owners' funding needs separate evidence. A project with insufficient runway, assumptions or stress scenarios does not become sustainable merely by paying the minimum capital.
06
People and technology must be under effective control
Define the board, executive responsibility, compliance, MLRO, finance, safeguarding, risk, technology and security owners. Outsourcing processing, cloud, KYC, cards or support does not outsource accountability. The FCA file covers due diligence, contractual rights, access and audit, data locations, incident escalation, continuity, exit and the firm's ability to control its ledger, balances, reconciliations and complaints.
07
A pending application does not authorise regulated business
The firm must not start regulated activity until it has the required authorisation or registration and has satisfied its conditions, unless a valid exclusion applies. After approval, confirm the exact Scope of Permission, restrictions, agents and distributors, safeguarding bank, scheme partners, customer terms, financial promotions, reporting and launch controls. UK permission applies to the UK perimeter and creates no automatic right to service EEA or other-country customers.
08
The licensing project runs from regulatory memorandum to controlled launch
First document the product and money flow, then choose the category and entity, governance and people plan, capital and forecasts, safeguarding and banking strategy, AML, fraud, cyber, outsourcing and policies. Complete a gap review and pre-application preparation before filing. Maintain one FCA response register, update documents for changes and, after authorisation, close conditions, test operations and only then onboard customers.
FAQ
FAQ
Can we buy an existing UK EMI?
A regulated-firm acquisition needs permission, history and liability due diligence and normally an FCA change-in-control process. The licence is not transferred separately from the company.
Is incorporation and an application enough to start?
No. Regulated activity cannot begin before the required decision, and the application must evidence a ready operating model.
Is an EMI account a bank account?
Not necessarily. Product status, safeguarding and protection depend on the institution and permission; an EMI must not be presented as a bank.
Does an FCA licence cover the entire EU?
No. UK authorisation is not an automatic EEA passport; each country and cross-border model needs separate analysis.
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