top of page

Enabling you to gain access to the UK market and offer payment services, including, payment accounts, payment processing, merchant acquiring and money transfer services.

Small Payment Institution (SPI),
United Kingdom

Becoming a Small Payment Institution, also known as the SPI license registration in the UK

If you wish to become a Small Payment Institution, also known as the SPI license registration, in the UK, then you will need to apply to the FCA for registration as a Small Payment Institution. Below you will find key information and requirements to become a small payment institution in the UK.

 
Below you will find the key information about obtaining the Small Payment Institution, also known as the SPI license registration in the UK. If you wish to become a Small Payment Institution, also known as the SPI license registration in the UK, you must meet the FCA's threshold conditions.
 
Buckingham Capital Consulting can help you to become a Small Payment Institution, also known as the SPI license registration in the UK, by offering a full end-to-end service, from company formation to complete application preparation and management.

Services provided by a Small Payment Institution License in the UK

 

A Small Payment Institution license enables the license holder to offer the following:

- services enabling cash to be placed on a payment account and all of the operations required for operating a payment account;

- services enabling cash withdrawals from a payment account and all of the operations required for operating a payment account;

- the execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider, including, execution of direct debits, including one-off direct debits; execution of payment transactions through a payment card or a similar device; execution of credit transfers, including standing orders;

- the execution of payment transactions where the funds are covered by a credit line for a payment service user, including the execution of direct debits, including one-off direct debits; execution of payment transactions through a payment card or a similar device; execution of credit transfers, including standing orders;

- issuing payment instruments or acquiring payment transactions;

- money remittance;

The UK regulator for Small Payment Institutions

The Financial Conduct Authority is the UK’s regulator for financial services, including, consumer credit, payment services, e-money, lending, insurance and investment services. The Financial Conduct Authority is the regulator for 59,000 financial services firms and financial markets in the UK.

The UK regulations for Small Payment Institutions (SPI)

The Payment Service Directive 2 or PSD2 for short, is an EU Directive (Directive 2015/2366) that sets requirements for businesses wishing to provide payment services. It applies to small payment institutions and their customers.

The PSD2 directive aims to promote innovation within the payments sector and improve protection for consumers, whilst making payments both safer and more secure. The PSD2 directive came into force on 13 January 2018.

The following regulations are also applicable to payment institutions:

 

- Revised Payment Services Directive (PSD2)

- Payment Accounts Directive

- Credit transfers and direct debits in euro (SEPA)

- The Payments in Euro (Credit Transfers and Direct Debits) Regulations 2012

- Data Protection Act 2018

- Guide to the UK General Data Protection Regulation (UK GDPR)

- Proceeds of Crime Act 2002 (POCA)

- Terrorism Act 2000

- Money Laundering, Terrorist Financing and Transfer of Funds 2017

- Regulation on interchange fees for card-based payment transactions (EU) 2015/751

- The Money Laundering and Terrorist Financing Regulations 2019

 

Reasons for choosing the UK for your Small Payment Institution (SPI)

- world’s fifth-largest economy

- low corporation tax

- low business costs

- business tax relief of up to 230% on research and development

- access to a highly-skilled workforce

- strong fintech growth and investment

- strong reputation in financial services

 

 

Key features of a Small Payment Institution (SPI) in the UK

- no initial capital requirement.

- optional to safeguard client funds.

- average monthly payment transactions cannot exceed EUR 3m.

- the management body of the payment institution must be of good repute and possess the relevant qualifications and experience to perform their duties.

 

Documents required as part of a Small Payment Institution (SPI) license application

As part of a Small Payment Institution license application, the following information must be prepared and provided to the regulator:

- company identification details 

- programme of operations 

- a description of your business’s organisation structure 

- compliance & governance arrangements and internal controls 

- procedure for monitoring, handling, and following up on security incidents and security-related customer complaints 

- processes for filing, monitoring, tracking and restricting access to sensitive payment data 

- business continuity measures 

- the principles and definitions applicable to the collection of statistical data on performance, transaction and fraud 

- security policy 

- internal control mechanisms to comply with obligations in relation to money laundering and terrorist financing (AML/CTF obligations) 

Our People

Our team of regulatory and compliance experts boasts diverse backgrounds spanning various sectors, providing a holistic understanding of our clients' challenges. With our service being led by seasoned professionals, you'll have direct access to senior experts, often at the director level, ensuring personalised attention. Combining robust regulatory knowledge with commercial insight, our team delves deep into your business to tailor unique solutions specifically suited to your needs.

Seeking something more bespoke or not listed above? Contact us to discuss your unique requirements. With our expertise and experience in financial services, chances are we can assist you effectively.

bottom of page