The FCA grants five licences for non-bank payment and e-money businesses. Two are authorisations under the Payment Services Regulations 2017 (PSRs) and the Electronic Money Regulations 2011 (EMRs); three are registrations, with lighter requirements and limits on size or scope.
This guide is written for founders, finance directors, general counsel and investors choosing between them. The right licence follows from the business model, the expected volumes, the services and the growth plan, in that order.
| Licence | FCA application fee | Initial capital |
|---|---|---|
| API | £2,820 (services f to h only) or £5,640 | €20,000, €50,000 or €125,000 |
| SPI | £1,130 | None |
| RAISP | £1,130 | None; professional indemnity insurance |
| Authorised EMI | £5,640 | €350,000 |
| Small EMI | £1,130 | None below €500,000 average outstanding e-money, then 2% |
| Licence | Volume limit | Payment initiation and account information |
|---|---|---|
| API | None | Both permitted |
| SPI | €3m monthly average of payment transactions | Neither |
| RAISP | None | Account information only |
| Authorised EMI | None | Both permitted |
| Small EMI | €5m average outstanding e-money; €3m monthly unrelated payments | Neither |
| Licence | CASS 15 safeguarding | Firm's planning figure, submission to decision |
|---|---|---|
| API | Required where it holds customer funds | 6 to 8 months |
| SPI | Optional; the firm may choose to safeguard | Weeks to a few months |
| RAISP | Not applicable; holds no funds | Weeks to a few months |
| Authorised EMI | Required | 6 to 8 months |
| Small EMI | Required | A few months |
No UK licence gives access to the EU: passporting ended on 31 December 2020. Fees are from the FCA's application fees page (updated 13 July 2026); the earlier figures of £1,120, £2,790 and £5,580 are out of date. The FCA must decide a complete application within 3 months and any application within 12 months; its median for payment and e-money authorisations in April to June 2026 was 219 days, about 7 months. Each cost is explained in our guide to FCA PI and EMI licence costs.
An API is authorised under the PSRs to provide payment services without being a bank. Merchant acquirers, money remitters, payment platforms, open banking firms and corporate payment providers are typical APIs.
An API can provide all eight payment services in Schedule 1 to the PSRs: cash placement and withdrawal, executing transfers, credit-linked transfers, card issuing and merchant acquiring, money remittance, payment initiation and account information. There is no volume limit. An API cannot issue e-money, take deposits or lend customer funds; it can offer short-term credit linked to a payment only under strict conditions.
| Services | Initial capital |
|---|---|
| Money remittance only | €20,000 |
| Payment initiation | €50,000 |
| Any of services (a) to (e) | €125,000 |
The highest applicable figure applies, not the sum. After authorisation the API holds own funds at least equal to the higher of its initial capital and a figure calculated under Method A, B or C, as the FCA directs.
An API that holds customer funds safeguards them under CASS 15, in force since 7 May 2026: daily reconciliation, a monthly safeguarding return, a resolution pack and an annual safeguarding audit. The FCA expects a UK-based leadership team with payments experience, including a CEO, a money laundering reporting officer (MLRO), compliance and finance capability, and a board that oversees the business. APIs are not under the Senior Managers and Certification Regime (SM&CR); the FCA assesses each director and manager at application.
Buckingham Capital Consulting obtained FCA API authorisation for Nexpay, Orbital, Oval (with open banking) and Global Send. The API route is set out in our UK payment institution licence guide.
An SPI is registered, not authorised, for payment services where the monthly average of payment transactions over the previous 12 months, or projected for a new firm, does not exceed €3m. The applicant must be a UK company with its head office in the UK.
An SPI can provide the payment services in paragraphs (a) to (f) of Schedule 1, including transfers, card issuing, merchant acquiring and money remittance. It cannot provide payment initiation or account information services, and it cannot issue e-money.
There is no initial capital requirement. SPIs may choose to safeguard customer funds, and many adopt CASS 15 standards voluntarily to prepare for authorisation; the FCA encourages SPIs that safeguard to arrange an annual audit. The directors and managers must be fit and proper, the firm must comply with the Money Laundering Regulations 2017, and no manager may have a conviction for money laundering, terrorist financing or other financial crime.
Early-stage firms testing a model, businesses whose volumes will stay under €3m a month, and niche remitters serving one corridor or community. Buckingham Capital Consulting obtained FCA SPI registration for Onpoint Money. Our SPI registration guide covers the route in full.
A RAISP is registered to provide account information services only: with the customer's consent, it collects and consolidates data from the customer's payment accounts at banks and other providers, usually through open banking connections.
A RAISP never holds customer funds, initiates payments, executes transactions or issues payment instruments or e-money.
There is no initial capital requirement. A RAISP must hold professional indemnity insurance, or a comparable guarantee, covering its liability to account providers and customers. The minimum cover is calculated using the method in the FCA's Approach Document.
Assessment concentrates on data security, consent management, compliance with UK data protection law and the firm's arrangements with account providers. Because no funds are handled, financial crime obligations are lighter than for a PI or EMI.
Adding payment initiation means applying for authorisation as an API, which is a new application rather than a change to the registration.
An authorised EMI is authorised under the EMRs to issue e-money: stored monetary value, issued when a customer pays in funds and accepted as payment by others. Prepaid cards, digital wallets, stored-value accounts and most UK neobank products sit on an EMI licence.
Everything an API can do, plus issuing, distributing and redeeming e-money, with no volume limit. An EMI cannot pay interest on e-money balances. It serves EU customers only through a separate entity authorised in an EU member state.
Initial capital of €350,000. After authorisation the EMI holds own funds of at least the higher of €350,000 and 2% of average outstanding e-money (Method D), plus a requirement under Method A, B or C for any payment services not linked to e-money. Method D passes the €350,000 floor at €17.5m of average outstanding e-money.
CASS 15 applies to all e-money in issue and to funds received for payment services. The FCA expects an experienced, UK-based leadership team with e-money or banking experience, robust risk management and independent challenge on the board in proportion to the size of the business. EMIs are not under SM&CR; the FCA assesses directors and managers at application.
Buckingham Capital Consulting obtained FCA EMI authorisation for Dzing Finance, Hryze and HFS, and UK EMI authorisation for EuroPanPay. The full procedure is in our UK EMI licence guide.
A small EMI is registered to issue e-money while its average outstanding e-money, measured over the preceding six months, stays at or below €5m, and its payment services not linked to e-money stay at or below a €3m monthly average. It cannot provide payment initiation or account information services.
No initial capital is required below €500,000 of average outstanding e-money; from that level the firm holds at least 2% of the average, which is €100,000 at the €5m ceiling. Safeguarding under CASS 15 is mandatory, as for an authorised EMI.
The €5m limit is reached quickly by a consumer product with any scale, and moving up to authorised EMI is a new application with the full €350,000 capital. Most firms with ambitions beyond a narrow product apply for full authorisation from the start. The small EMI suits:
Our small EMI guide answers the common questions on the route.
The choice between an API and an authorised EMI is the one most fintechs make. It turns on a single question: will customers hold a balance with the firm that they can spend later?
| Question | Points to API | Points to EMI |
|---|---|---|
| Do customers hold balances between payments? | No; funds move straight through | Yes; wallets or accounts hold value |
| Prepaid or debit cards on own balances? | No | Yes |
| Capital available | €20,000 to €125,000 | €350,000 and growing at 2% of balances |
| Product roadmap | Transfers, remittance, acquiring, open banking | Accounts, cards, multi-currency wallets |
A payment institution can hold customer funds only for the time needed to execute a payment; it cannot keep stored balances. A firm that starts as an API and later adds wallets makes a new application under the EMRs, so a roadmap that includes stored value within the planning horizon usually points to an EMI from the outset.
An SPI costs £1,130 to register and needs no capital, against £5,640 and up to €125,000 for an API. The saving is real for a firm that stays small. For a firm that passes €3m a month within two years, the SPI route means a second application, a second assessment of 6 to 8 months during which volumes must stay under the limit, and the API capital in any case. Firms in that position usually apply for the API directly.
Map each product to the eight payment services and to e-money. Holding stored value that customers spend points to an EMI. Account information only points to a RAISP. Payment services without stored value point to an API or SPI.
A payment business above a €3m monthly average, or an e-money business above €5m of average outstanding e-money, needs an authorised licence. A registered firm must stay within its limits until it is authorised, and in consumer fintech the limits arrive sooner than many founders expect.
If the plan shows growth past the small limits within two to three years, apply for authorisation directly. A move from small to authorised status is a new application with a second fee, full capital and a full assessment, and investors increasingly expect a clear path to an API or authorised EMI.
Both are central to open banking, embedded finance and business payment automation. If either is on the product roadmap, plan for an API (for payment initiation) or a RAISP (for account information only) from the outset, because neither small registration permits them.
No UK licence gives access to the EU. Firms serving both markets plan a UK licence and a separate EU authorisation, in parallel or in sequence, depending on market priority, capital and management capacity.
| Move | How it is done |
|---|---|
| SPI to API | New application for authorisation |
| Small EMI to authorised EMI | New application for authorisation |
| RAISP to API with payment initiation | New application for authorisation |
| API to EMI | New application under the EMRs |
| API adding payment services | Variation of permission, £1,410 or £565 |
The FCA states that moving between registered and authorised status needs a new application, not a variation, and that the wrong application type is returned. Each new application follows the full timeline, so authorising at the target level is usually the better choice when the direction is clear.
| Business | Licence | Why |
|---|---|---|
| Consumer remittance app processing €5m a month | API | Above the SPI limit; €20,000 capital if remittance only, €125,000 if it also executes transfers from accounts |
| Business payment platform processing €40m a month | API, or authorised EMI if it holds balances | No volume limit; stored balances need e-money |
| Personal finance app using open banking data | RAISP | Account information only, no funds handled |
| Embedded finance platform issuing accounts and prepaid cards to business users | Authorised EMI | Stored value and cards at scale |
| Single-corridor remitter processing €1m a month | SPI, with a planned move to API | Within the €3m limit today |
| Account-to-account merchant payments through open banking | API with payment initiation | €50,000 capital, or €125,000 with other services |
| Consumer neobank | Authorised EMI | E-money accounts, cards and scale from launch |
Firms that need a regulated product before their own licence is granted can launch as the agent of a PI or the distributor of an EMI, under that firm's licence and supervision, and move to their own licence later.
| Licence | Periodic fee 2026/27 |
|---|---|
| API | £628 minimum, plus £0.309 per £1,000 of relevant income above £100,000 |
| SPI | £652 flat |
| Authorised EMI | £2,063 minimum, plus £43.40 per £1m of average outstanding e-money above £5m |
| Small EMI | £1,432 flat |
These are the FCA's final rates in PS26/14, published on 2 July 2026. Firms also pay the Financial Ombudsman Service general levy, and in the first year the FCA charges a proportion of the annual fee based on the months remaining.
| Licence | Main returns |
|---|---|
| API and authorised EMI | Capital and financial returns, payments fraud report every 6 months, operational and security risk report at least yearly, monthly safeguarding return |
| SPI | Annual financial return, transactions report before the end of each January, payments fraud report every 12 months |
| Small EMI | Annual return, outstanding e-money report by the end of each January, payments fraud report every 12 months, monthly safeguarding return |
| RAISP | Annual financial return and payments fraud report every 12 months |
A firm that needs to trade before its own licence is granted, or that does not yet need one, can operate under another firm's licence.
These routes are quicker to start, but the licensed principal controls the compliance framework and takes a share of the economics. Many firms use them to launch and build volume while their own application is prepared and assessed.
The licence is assessed by more than the FCA. Banks offering safeguarding and operating accounts, card scheme sponsors and investors each form a view of whether the licence fits the plan.
Choosing the licence the business will need in two to three years, rather than the one that is quickest today, usually satisfies all three.
Buckingham Capital Consulting has worked on UK payment licences since 2013. The firm advises on licence selection, covering the regulatory perimeter, capital, governance, timing, cost and the upgrade path, and prepares the full application through the FCA's questions to the decision. For firms already licensed, it runs gap analyses and applications for the move from SPI to API, small EMI to authorised EMI, RAISP to API and API to EMI, and supports safeguarding under CASS 15, regulatory reporting and FCA supervision. Our guide to FCA PI and EMI timelines sets out how long each stage takes.
An EMI can issue e-money and hold customer balances; an API provides payment services only. An EMI needs €350,000 initial capital against €20,000 to €125,000 for an API.
Start with an SPI if volumes will stay under the €3m monthly average for several years. If the plan shows growth past it, apply for an API directly, because moving up is a new application.
No. A RAISP provides account information only. Payment initiation or other payment services need authorisation as an API or an EMI.
An EMI, authorised or small, because prepaid card balances are e-money. Other firms can distribute an EMI's cards as its distributor or programme manager.
No. APIs, SPIs, RAISPs and EMIs are not under the Senior Managers and Certification Regime; the FCA assesses their directors and managers at application.
A single firm does not need both, because an EMI authorisation already covers payment services. Some groups hold them in separate companies.
It must apply for authorisation as an API and stay within the limit until authorised, so firms start the application well before reaching it.
No. Passporting ended on 31 December 2020, so EU customers are served through a separate EU-authorised entity.
Buckingham Capital Consulting has obtained FCA payment and e-money licences for firms including Nexpay, Oval, Onpoint Money and Dzing Finance since 2013, and arranges the safeguarding and operating accounts alongside the application. The firm advises on the choice between API, SPI, RAISP and EMI routes and plans the move from one licence to the next as the business grows.
Speak to an expert: WhatsApp +44 7563 115980, Telegram @buckinghamcapital or info@buckinghamcapitalconsulting.co.uk.
This article is general information, reviewed against the regulator’s published requirements on the date shown. It is not legal advice; the regulator’s current publications take precedence.