MEMA Scope · Assessment
Do small payment institutions need FCA authorisation?
A firm providing payment services at modest volumes that wants to register rather than seek full authorisation. Review the initial view below and answer a few questions to refine it.
- Personalised to your business
- FCA rule references
- Follow-up questions available
Potential regulated activity identified
You may be able to register as a small payment institution
Registration is available where conditions on volume and services are met. Small payment institutions cannot provide payment initiation or account information services.
Route to consider: Registration rather than full authorisation
Why this was flagged
- 1Providing payment services by way of business needs authorisation or registration.
- 2A small payment institution registers rather than being authorised, if it meets the conditions.
Questions still to resolve
Answer to refine the view. The result updates as you go.
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Is your average monthly payment volume expected to stay at or below EUR 3m, including transactions by agents?
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Do you provide payment initiation services?
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Do you also provide account information services alongside payments?Account information alone can be registered separately as a RAISP.
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Do you issue cards or acquire card payments?
Regulatory basis to examine
Your next steps
- 1Calculate your projected average monthly payment volume and test the threshold
- 2Confirm that you provide only the services a small payment institution can offer
- 3Prepare your registration and complete AML registration with HMRC or the FCA as applicable
- 4Plan for growth: what happens if volumes exceed the threshold
Where applications for this model most often fall short
- A defensible volume forecast
- Clear AML policies and a named MLRO
- A growth plan if you outgrow the threshold
This is an initial indication from published FCA material, not an FCA determination or legal advice.
If authorisation is required, check the firm’s governance, policies, resources and application preparedness.
MEMA Scope gives an initial view from published FCA material. It is not legal advice or an FCA determination. Automatic matching and typed questions use AI only to choose a profile and to answer from vetted guidance; the assessment itself is never written by AI.
About this business model
A firm providing payment services at modest volumes that wants to register rather than seek full authorisation.
Registration is available where conditions on volume and services are met. Small payment institutions cannot provide payment initiation or account information services.
This page gives an initial view from published FCA and legislation sources. It is not an FCA determination or legal advice. Not your business model? Describe your business in MEMA Scope.
Small payment institution: frequently asked questions
Can I register as a small payment institution?
Registration is available if your payment services meet the volume and service conditions in the PSRs, broadly an average of no more than EUR 3m per month and no payment initiation or account information services.
Do small payment institutions have to safeguard customer funds?
Authorised payment institutions must safeguard relevant funds; for small payment institutions safeguarding may be voluntary, but you should check the current rules for your situation.
What could change the answer for small payment institutions?
Registration is available where conditions on volume and services are met. Small payment institutions cannot provide payment initiation or account information services. It can change depending on the answers to questions such as: Is your average monthly payment volume expected to stay at or below EUR 3m, including transactions by agents? Do you provide payment initiation services? Do you also provide account information services alongside payments? Do you issue cards or acquire card payments?
Which FCA rules should small payment institutions look at first?
Start with: Conditions for registration as a small payment institution; Payment services; FCA: payment institution applicants; Perimeter guidance on the PSRs. This is an initial view from published FCA material, not an FCA determination.
What are the first steps for small payment institutions?
Calculate your projected average monthly payment volume and test the threshold. Confirm that you provide only the services a small payment institution can offer. Prepare your registration and complete AML registration with HMRC or the FCA as applicable. Plan for growth: what happens if volumes exceed the threshold.
Businesses we check
MEMA Scope covers 32 common business models. Each page explains whether that kind of business may need FCA authorisation, the rules to look at and the routes to consider.
Consumer credit
- Do car dealers offering finance need FCA authorisation?
- Do motor finance brokers need FCA authorisation?
- Do retailers offering buy now pay later need FCA authorisation?
- Do consumer lenders need FCA authorisation?
- Do debt collectors and debt administrators need FCA authorisation?
- Do debt management and debt advice firms need FCA authorisation?
- Do credit lead generators and comparison sites need FCA authorisation?
- Do rent-to-own and vehicle leasing providers need FCA authorisation?
- Do credit brokers introducing customers to lenders need FCA authorisation?
Payments and e-money
- Do payments apps and payment processors need FCA authorisation?
- Do e-money issuers and digital wallets need FCA authorisation?
- Do agents of payment institutions need FCA authorisation?
- Do open banking providers need FCA authorisation?
- Do money transfer and remittance businesses need FCA authorisation?
- Do marketplaces handling payments need FCA authorisation?
Insurance
Mortgages
Investments and wealth
- Do financial advisers need FCA authorisation?
- Do discretionary investment managers need FCA authorisation?
- Do investment platforms and wealth-tech firms need FCA authorisation?
- Do crowdfunding and peer-to-peer lending platforms need FCA authorisation?
- Do corporate finance boutiques need FCA authorisation?
Other regulated activities
- Do claims management companies need FCA authorisation?
- Do funeral plan providers and sellers need FCA authorisation?
- Do introducers and referral partners need FCA authorisation?
- Do international firms entering the UK need FCA authorisation?
- Do accountants and solicitors giving financial advice need FCA authorisation?
Want a consultant to look at your facts?
Book a free scoping call and we will map the permissions, evidence and timeline for your firm.
Phone: 0330 133 0811
Email: contact@memaconsultants.com