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The UK Financial Conduct Authority’s (FCA) updated guidance on preparing financial information for authorisations emphasises that firms must be ready, willing and organised to comply with both existing and future rules.
For payments, e-money and crypto firms, this means submitting comprehensive, reconciled financial histories and forward-looking forecasts, supported by transparent funding and credible wind-down plans.
Overly optimistic or inconsistent submissions risk delay or rejection, so firms should treat this guidance as the FCA’s de facto benchmark for authorisation.
What the FCA means by “ready, willing and organised”
- Ready: Firms should fully absorb the FCA’s requirements before submitting their financial information. All documents must be final (not drafts) and properly reviewed and signed off. Firms that seek advice and clarify their obligations will be better placed to submit effective applications.
- Willing: The FCA considers how firms engage with it, expecting organisations and individuals to be open, honest, proactive and responsive. Submitting a weak or incomplete application cannot be redeemed later by simply showing willingness.
- Organised: Firms must have structures, processes and documentation in place to operate from “day one”. The FCA will assess whether they could realistically carry out the activities they are applying for immediately.
This standard is not unique to payments or crypto; it applies across all FCA authorisations.
However, in higher-risk sectors such as payments, e-money and crypto, failing this test – through weak financials, inconsistent narratives or missing documentation – is often fatal to authorisation hopes.
Key expectations
- All financial documents (historic, management, forecasts) must be internally consistent, signed off and reconciled.
- Forecast assumptions must show prudence and include downside, stress and sensitivity analysis.
- Funding sources must be transparent and committed, with liquidity buffers in place.
- Forecasts must reflect operational realities, including staffing, IT, safeguarding infrastructure and anti-money-laundering (AML) systems.
- Forecasts and financials must map to a credible wind-down plan, with details of costed triggers and operational execution.
- The FCA will test whether, if authorised today, a firm could operate under the submitted forecasts (i.e. that it is “organised”).
Payments and e-money firms
What the FCA expects
- Reconciled historic accounts and management reports where applicable.
- Revenue, cost and headcount forecasts with stress scenarios, including volume decline, fraud and margin compression.
- Formal funding commitments, liquidity backstop lines and buffer capital to cover unexpected outflows.
- Forecasts aligned to safeguarding obligations, liquidity needs and wind-down execution costs.
Common weaknesses (and their signals)
- Optimistic assumptions without stress testing: these indicate a weak risk culture and poor scenario planning.
- Uncommitted intra-group support: reliance on promises rather than formal agreements undermines credibility.
- Operational mismatch: assumed volume growth without corresponding investment in reconciliation systems or staffing is a red flag.
- Under-costed wind-down: firms must not assume the quick return of customer funds without modelling the operational cost of doing so.
Implications for applicants
Payments and e-money firms must show financial resilience under stress, and tie all their forecasts to operational feasibility. In addition, their wind-down plans must be fully costed and testable.
Weaknesses in these areas risk signalling a firm is not “organised” for real-world stresses.
Crypto firms
What the FCA expects
- Financial projections that reflect business continuity across exchange, custody or other crypto services.
- Funding allocations for compliance, AML, remediation and on-chain monitoring as volumes grow.
- Transparent scaling of compliance and operational costs in line with user and transaction growth.
Common weaknesses (and their signals)
- Disconnect between volumes and compliance costs: where firms project users without scaling AML, monitoring teams or infrastructure.
- Overreliance on unregulated or overseas affiliates: lacking contractual and financial safeguards suggests weak governance.
- Overly optimistic customer acquisition or margin assumptions: this reflects weak market discipline or wishful thinking.
Implications for applicants
Crypto firms must adopt conservative, evidence-based assumptions.
They should treat prudential discipline as a growing expectation, not an optional stretch – especially as regulatory developments point in that direction.
Key themes and regulatory signals
The updated guidance reflects the FCA’s priorities, and as such gives payments, e-money and crypto firms valuable insight into how they should prioritise their efforts when compiling financial information.
- Evidence over intention: The FCA’s “ready, willing and organised” standard underscores its preference for data-backed, internally consistent submissions rather than promises of future fixes.
- Stress and downside scenarios: These are now mandatory, providing testable evidence of risk planning.
- Wind-down planning as a core capability: Forecasts must tie into executable wind-downs, with triggers and cost models embedded.
- Convergence of expectations: Payments, e-money and crypto firms are being held to similar norms of prudential robustness, resilience, committed funding and credible operations as other financial organisations.
- Horizon regulatory movement: Ongoing crypto consultations, safeguarding reforms and operational resilience expectations will continue to raise the baseline, so firms should continue to monitor the FCA’s announcements and activity.
Organisations that embed the FCA’s guidance into their financial reporting will build stronger relationships with the regulator.
Effective compliance leads to smoother processes, lower costs and better outcomes, enabling firms to move ahead with their plans more quickly.
