UK embedded payments provider Modulr has had a temporary ban on onboarding new customers lifted but must give the financial regulator a warning when doing so.
The collapse of US Banking-as-a-Service (BaaS) provider Synapse has increased the focus on BaaS, with some critics questioning its business model.
Modulr, which has an EMI licence and is backed by PayPal, provides payment services for the likes of Revolut, Sage and Ripple.
By using Modulr’s tech, its clients circumvent the need to build their own payment infrastructure, become regulated and run a payment network.
Investors in Modulr, founded in 2016, include PayPal Ventures, Blenheim Chalcot, Frog Capital and Highland Europe.
In October last year, the Financial Conduct Authority (FCA) told Modulr to stop onboarding some new customers over regulatory concerns, Sifted reported.
The ban meant it could not onboard new “partner” clients, specifically “agents and distributors”, which use its payment services for cards or accounts.
The move came amid regulatory changes including new rules on consumer protection across financial services and new rules on push payment fraud.
However, the temporary ban has now been lifted, according to the FCA.
The FCA says:
“The firm has agreed with the Authority that it will not without providing prior written notification to the Authority of at least 10 business days, on-board any new agent and/or distributor.”
Modulr said it had made “enhancements” to its onboarding and oversight processes.
Modulr said:
“Following a temporary pause in onboarding new Agent & Distributor (A&D) Partners in the UK, we have made a number of enhancements to our A&D Partner onboarding and oversight processes.
“Having now implemented these changes as well as undertaking extensive internal and external testing and assurance, we have agreed with the UK’s Financial Conduct Authority (FCA) to recommence new A&D Partner onboarding subject to providing advanced notice of each A&D Partner.”
Earlier this month it was reported that German BaaS firm Solaris faced financial penalties if it doesn’t improve its financial controls, according to the German financial regulator BaFin.
Image: Pixabay
LONDON (AP) — The European Union said Thursday it will outline steps to compel Apple to open up its iPhone…
Plaid, the US multi-billion-dollar-valued open banking firm, has restructured its senior management team and appointed a new European boss. Mike Saunders, who
Capmont Technology – a venture capital firm investing in B2B technology startups across Europe and the US – has announced the launch of a €100 million fu
Apple Inc. has been warned by the European Union to open up its highly guarded iPhone and iPad operating systems to rival technologies, or eventually risk sig