Who payments product advice is for

Launching a new payment product or changing an existing one and not sure what regulatory approvals you need? We advise on product classification, authorisation requirements and ongoing conduct obligations so you can launch with confidence and avoid costly mid-build regulatory surprises.

Product type	Likely regulatory status	Authorisation route	Key ongoing obligations
E-money issuance (prepaid cards, digital wallets)	Electronic money institution	EMRs 2011, reg 6 (FCA authorisation)	Safeguarding (reg 20-22); capital requirements; Consumer Duty
Payment initiation services	Payment institution (PISP)	PSRs 2017, reg 5 (FCA authorisation)	Professional indemnity insurance; SCA compliance; Consumer Duty
Account information services	AISP (registered)	PSRs 2017, reg 14 (FCA registration)	Data protection (AISP-specific); professional indemnity insurance
Card programme (issuing or acquiring)	Payment institution or e-money institution	PSRs 2017 or EMRs 2011 (depends on product structure)	Scheme membership rules (Visa/Mastercard); interchange fee regulation; Consumer Duty
Agent model (payments via agents)	Agent of authorised institution	PSRs 2017, reg 36 (registration by principal)	Principal remains fully responsible; FCA agent register; AML obligations

Typical triggers

• The business is launching a new e-money product and needs advice on safeguarding obligations under the Electronic Money Regulations 2011
• The FCA raises questions about the firm’s Consumer Duty implementation during a supervisory review
• A dispute arises with a card scheme over access terms or compliance with scheme rules, and the firm needs to understand its position under PSR directions

What we deliver for payments product launches

• Launch-readiness memo: confirmation that the proposed product sits within your authorisation and satisfies safeguarding, scheme and Consumer Duty requirements
• Safeguarding opinion: advice on safeguarding method, structure and adequacy for a specific product or volume change
• Scheme rule assessment: analysis of a specific scheme rule change and its impact on your operations
• Consumer Duty gap analysis: assessment of Consumer Duty compliance for a defined product, with remediation steps where needed
• Product regulatory sign-off note: a board paper confirming the regulatory position of a new or changed product
• Consumer Duty assessment: a review of how Consumer Duty requirements apply to your payments product, identifying any gaps in product governance, fair value assessments or communications
• Regulatory change impact note: where a rule change or new FCA guidance affects your product, a practical assessment of what needs to change and by when

If you need advice on safeguarding, Consumer Duty or scheme governance for a payments product, we can start with an initial scoping call. See all our direct legal advice services or get in touch.

Why payments product advice matters now

The FCA has intensified its supervisory focus on payments product design and governance since Consumer Duty took effect in July 2023. Firms must demonstrate that every payments product delivers fair value, is designed to meet the needs of the target market and does not cause foreseeable harm. The PSR has separately increased scrutiny of scheme compliance, particularly around interchange fees, access requirements and protections for indirect access holders. These overlapping requirements mean that payments product launches now require coordinated regulatory analysis across multiple regimes.

Safeguarding remains the most common area of regulatory concern for payments product businesses. The FCA expects authorised payment institutions and electronic money institutions to maintain safeguarding arrangements that protect customer funds at all times, including during operational disruption. A payments product that changes the flow of funds or introduces new settlement arrangements may require updated safeguarding assessments and revised reporting to the FCA.

Rob Bratby advises on payments product launches and regulatory compliance as General Counsel at UK Payments Initiative. He brings direct experience of the FCA and PSR regulatory framework, combined with Chambers UK (Band 2) telecoms ranking and recognition by Lexology as a Global Elite Thought Leader for data protection.

Related direct legal advice pages

See also our other direct legal advice pages:

• Do I need regulatory authorisation before offering my product in the UK?
• What should I do if a regulator is investigating my business?
• What regulatory risks should I check before buying a regulated business?
• Commercial and Technology Contract Support
• AI, Data and Governance Advice
• Telecoms Product Launch Advice
• Deal Structuring and Negotiation
• Direct Legal Advice (overview)

Regulatory context for payments product advice

Payments product advice sits within the broader regulatory framework for UK payments. The Payment Services Regulations 2017 set the authorisation and conduct requirements that apply to every payments product offered in the UK. The FCA supervises authorised firms and has enforcement powers including the ability to impose requirements, issue public censure and levy financial penalties. Since July 2023, the Consumer Duty adds a further layer of product governance, requiring firms to demonstrate that each payments product delivers fair value and meets the needs of the target market.

For broader payments regulation advice, see our payments regulation page. For advice on authorisation and licensing or operational resilience, see the relevant sub-pages.

Representative experience

Recent and representative matters include:

• Advised a fintech on the regulatory classification of a variable recurring payments product, confirming it could proceed under existing open banking permissions without a separate authorisation application.
• Structured a payment facilitation model to operate within the commercial agent exclusion, avoiding the need for the client to obtain its own FCA authorisation and saving approximately six months of lead time.
• Determined whether a stored-value wallet feature constituted e-money issuance, enabling the client to redesign the product to fall outside the EMRs regime while retaining core functionality.
• Supported a payments platform through FCA authorisation as an authorised payment institution, managing the application from pre-submission through to approval within the target timeline.
• Advised on Consumer Duty implications for a new payments product, including the fair value assessment and communications testing required before launch.

Frequently asked questions

What are my safeguarding obligations under the PSRs 2017?

If you hold relevant funds as an authorised payment institution, regulation 23 of the Payment Services Regulations 2017 requires you to safeguard those funds by either depositing them in a segregated account with a credit institution or covering them with an insurance policy or guarantee. The FCA expects safeguarding arrangements to be in place from day one of holding customer funds. We advise on the correct method, the operational procedures needed, and how to evidence compliance to the FCA during supervisory reviews.

How do scheme rules interact with the PSR’s regulatory framework?

Card scheme rules from Visa and Mastercard, and interbank scheme rules from Pay.UK, sit alongside the regulatory requirements imposed by the Payment Systems Regulator under the Financial Services (Banking Reform) Act 2013. Where scheme rules and PSR directions overlap, you need to comply with both. We advise on how the PSR’s access and governance directions apply to your participation in designated payment systems, and how to manage obligations under scheme rules at the same time.

What Consumer Duty obligations apply to a payments firm?

The FCA’s Consumer Duty (PS22/9) applies to all FCA-authorised payments firms that provide products or services to retail customers. It requires you to act to deliver good outcomes for customers across four areas: products and services, price and value, consumer understanding, and consumer support. We advise payments firms on how to implement the Duty proportionately, including the annual outcomes monitoring the FCA expects and how to document your assessment of fair value.

What safeguarding methods are available under the PSRs 2017?

Safeguarding requires authorised payment institutions and e-money institutions to protect customer funds in accordance with FCA rules. The method depends on your authorisation type and business model. We advise on the choice between segregation and insurance, the practical steps to implement compliant safeguarding arrangements, and how to evidence compliance to the FCA during supervision visits.

Does Consumer Duty apply to B2B payment services?

The FCA Consumer Duty requires firms to deliver good outcomes for retail customers across four areas: products and services, price and value, consumer understanding, and consumer support. For payments firms, this means reviewing product design, fee structures and customer communications. We help you assess your current position against the Duty requirements and build a practical compliance plan.

How does this differ from ongoing fractional GC support?

This page is for defined, matter-specific instructions: a product launch, a rule change, a safeguarding restructure. For ongoing embedded support, see the Fintech and Payments Fractional GC page. We advise payments businesses on the full range of product, safeguarding and scheme governance issues, working alongside your compliance and product teams to deliver practical solutions.

How does this page differ from the Payments Regulation page?

The Payments Regulation page explains the regulatory framework. This page is for a live instruction where you have a specific product question that needs answering before you build or go live. We advise payments businesses on the full range of product, safeguarding and scheme governance issues, working alongside your compliance and product teams to deliver practical solutions.

We are adding open banking functionality to our payments product. Do we need separate advice?

Adding open banking features to an existing payments product can change the regulatory position. Account information services and payment initiation services have distinct regulatory requirements under the Payment Services Regulations 2017. We advise on whether the new functionality requires a variation to your existing FCA authorisation and what additional compliance obligations apply.

How long does it take to get a payments product to launch-readiness from a regulatory perspective?

For a product within your existing authorisation scope, we can typically deliver a launch-readiness memo within two to three weeks. If the product requires a variation to your FCA permissions or a new safeguarding arrangement, the timeline depends on the FCA’s processing time. We advise on realistic timescales at the outset so the product team can plan accordingly.

We have received notice of scheme rule changes. How quickly can you assess the impact?

Scheme rule changes from Visa, Mastercard or the UK domestic schemes can have significant operational and commercial implications. We can typically provide an initial impact assessment within a week of receiving the rule change documentation. For complex changes affecting multiple product lines, we deliver a phased assessment with an early-stage summary followed by detailed analysis.

Can you advise us alongside our existing compliance consultants?

Yes. We frequently work alongside in-house compliance teams and external compliance consultants. Our role is to provide the legal analysis and regulatory opinion that sits above operational compliance. This works particularly well on payments product launches where the compliance team manages day-to-day implementation and we provide the legal framework and sign-off on regulatory questions.

What safeguarding requirements apply to my payments product?

If you hold customer funds as a payment institution or e-money institution, you must safeguard those funds under regulation 23 of the Payment Services Regulations 2017 or regulation 21 of the Electronic Money Regulations 2011. Safeguarding means segregating customer funds from your own, holding them in a designated account with an approved credit institution, or covering them with an insurance policy or guarantee. The FCA’s supplementary safeguarding regime, effective from May 2026, imposes additional requirements. We advise on structuring your safeguarding arrangements to meet both the existing requirements and the new regime.