Regulatory AlertsUnited Kingdom: fintech & payments regulation
RegulatedFCA-regulated VASP regime; PRA co-supervises; PSR oversees payment systems
- Lead regulator
- Financial Conduct Authority (FCA)
- Also involved
- PRA (prudential) · PSR (payment systems) · NCA (AML)
- Core law
- Financial Services and Markets Act 2000 (FSMA)
- Entry capital
- GBP 0 (VASP); GBP 20,000 (Small PI)
- Approval timeline
- 3-6 months
- Customer assets
- Safeguarded in segregated client accounts
- Data protection
- UK GDPR / Data Protection Act 2018 · ICO
- Sandbox
- Yes - FCA Regulatory Sandbox
The UK regulates fintech and payments primarily through the FCA under FSMA 2000. The regime is mature, requiring authorisation for payment services and e-money. A comprehensive cryptoassets regime was established in 2026, bringing stablecoins and custodial services under FCA supervision. The PRA co-supervises prudential aspects for larger firms.
Which licence do you need?
| Your activity | Requirement | Capital | Timeline | Authority |
|---|---|---|---|---|
| Payment processing / gateway | LicenceAuthorised Payment Institution[1] Requires authorisation under Payment Services Regulations 2017 | — | — | FCA |
| E-money & wallet issuance | LicenceAuthorised E-money Institution[1] Requires authorisation under E-money Regulations 2011 | — | — | FCA |
| Domestic money transfer | LicenceAuthorised Payment Institution[1] Domestic transfers covered under Payment Services Regulations 2017 | — | — | FCA |
| Cross-border remittance | LicenceAuthorised Payment Institution[1] Cross-border payments require FCA authorisation | — | — | FCA |
| Agent network | LicenceAuthorised Payment Institution[1] Agent networks must be covered by the firm's permission | — | — | FCA |
| Open banking / account information | LicenceAuthorised Payment Institution[1] Account Information Service Providers require FCA authorisation | — | — | FCA |
| Foreign-exchange services | LicenceAuthorised Payment Institution[1] FX services are payment services requiring FCA authorisation | — | — | FCA |
New — what changed recently
- 2026-06-26FCA Cryptoassets Regime Policy Statements — Established comprehensive FCA regulation for cryptoasset firms under FSMA 2000, including stablecoins and custodial services.[2]
- 2024-09-19PS25/12: Safeguarding regime changes — Finalised changes to safeguarding requirements for payments and e-money firms, enhancing prudential risk management.[1]
- 2024-09-06FG24/6: Risk-based approach guidance — Issued finalised guidance requiring firms to adopt a risk-based approach for managing payment services.[3]
Market-entry checklist
- 1Apply for FCA AuthorisationSubmit application under Payment Services Regulations 2017 or E-money Regulations 2011.
- 2Establish SafeguardingImplement segregated client account arrangements as per PS25/12.
- 3Register for AMLRegister with the National Crime Agency for anti-money laundering supervision.
- 4Prepare Risk FrameworkDevelop risk-based protocols for payment services as required by FG24/6.
- 5Engage with PSRIf operating payment systems, engage with the Payment Systems Regulator.