The UK Financial Conduct Authority (FCA) today announced the cancellation of PARAM@ UK LTD’s registration as a Small Electronic Money Institution under the Electronic Money Regulations 2011 (“the EMRs”).

The firm is no longer meeting the conditions for registration as an SEMI under the EMR’s. In particular, the firm has failed to take adequate measures for the purpose of safeguarding electronic money holders’ funds.

The Firm was registered by the FCA as a SEMI on 15 December 2020. As a condition of its registration, the Firm is required to take adequate measures for the purpose of safeguarding electronic money holders’ funds.

On 25 September 2023, the Firm was informed that its safeguarding account, which it held for the purposes of safeguarding electronic money holders’ funds, was to be withdrawn.

On 13 November 2023, the Firm was informed that the safeguarding account will be withdrawn on 30 April 2024.

Between 15 November 2023 and 21 February 2024, the Authority liaised with the Firm about its progress i n procuring new safeguarding measures. The Firm reassured the Authority that it was confident that it would have finalised the migration to a new safeguarding account by March/April 2024, i.e. before its current safeguarding account was withdrawn.

On 26 February 2024 the Firm notified the Authority that it had decided to halt the issuing of electronic money and transform its business model into a merchant acquiring platform.

On 8 April 2024 the Authority sent the Firm a letter setting out its concerns in relation to the Firm not meeting the conditions of its registration by not having adequate safeguarding measures in place and asked the Firm to sign a Voluntary Undertaking agreeing to cease issuing electronic money and onboarding new customers. The Firm signed the undertaking on 15 April 2024.

On 30 April 2024, the Authority reiterated its concerns to the Firm about not having adequate safeguarding arrangements in place and therefore not being able to meet its conditions for registration from 1 May 2024. The Firm responded on 7 May 2024 stating that it was expecting to have finalised its safeguarding arrangements within Quarter 3 of 2024.

On 15 May 2024 the Authority again raised its concerns with the Firm about it not having adequate safeguarding arrangements in place. In response the Firm requested a period of 3-months to effect a change in business model from money remittance to merchant acquiring and procure an adequate safeguarding provider.

Between 19 August 2024 and 29 August 2024, the FCA corresponded with the Firm, raising concerns that the Firm has made minimal progress effecting the change in business model and invited the Firm to cancel its registration noting that the change in business model will not involve the issuance of electronic money.

However, the Firm indicated that it wished to maintain its permissions to retain flexibility for future expansion into providing electronic money services again.

Between 7 October 2024 and 23 October 2024, the Authority raised its concerns with the Firm, on numerous occasions, about it not issuing e-money and lacking the relevant controls to do so. The Firm was further advised that as its new proposed business model will not involve issuing e-money it should cancel its registration as an SEMI and reapply as either an Authorised Payment Institution or a Small Payments Institution.

The Firm again reiterated its response that it wished to maintain its registration as it may be required for future business activities.

On 12 February 2025 the Authority issued the Firm a letter before action. The letter informed the Firm that as it was not meeting the conditions for registration as an SEMI a recommendation to cancel its registration would be made. The Firm was again invited to voluntarily cancel its registration.

The Firm’s responses of 24 February 2024, 5 March 2025 and 7 March 2025 have not addressed the Authority’s concerns raised in the LBA in relation to not having adequate safeguarding arrangements in place and not meeting the conditions for registration. The Firm’s responses have not demonstrated to the Authority that it has taken adequate measures for the purpose of safeguarding electronic money holder’s funds. The Firm was subsequently informed on 11 March 2025 that the enforcement action to cancel its registration as a SEMI would continue.

On 3 April 2025 the Firm submitted a Change in Control Notification. This did not change the Authority’s position.

The cancellation is effective July 7, 2025.