Safeguarding Statement

How we protect your money

At Pay Set, we prioritize the protection of your funds, regardless of which currency you hold.

As a UK Electronic Money Institution (EMI) authorised by the Financial Conduct Authority (FCA) under the UK Electronic Money Regulations 2011, we at Pay Set protect our clients funds through a process known as safeguarding, essentially using segregation of 100% of your funds from our own funds used for operating our business.

Segregation of funds is one of two optional safeguarding methods available to EMIs under the applicable UK legislation (the other being an insurance policy, which is less common).

This method is compliant with regulatory obligations and is achieved by (i) placing client funds in a ring-fenced account with an authorised credit institution in the UK or the European Economic Area, or (ii) investing them in secure, liquid, low risk assets placed in a separate account with an authorised custodian, or (iii) applying any combination of the two. Such a blend of cash and assets is intended to diversify risk and optimize liquidity.

It is the EMI’s responsibility to have appropriate and well-managed safeguarding arrangements designed to ensure that if the EMI fails, the segregated funds, which are kept protected and safe, will NOT be considered the EMI's funds and shall be used, to the greatest possible extent under such circumstances, for distribution to its customers in a timely and orderly manner.

Other creditors of an EMI cannot make claims against your protected funds, and the only reason clients may not receive 100% of their funds held under the safeguarding accounts, is where a receiver or another insolvency practitioner (e.g. administrator, liquidator) is appointed to manage the closure of the EMI, and in such case before clients are paid back fully, the cost of that practitioner is paid from these accounts, so each client may bear a fraction of this cost.

This is no different from similar circumstances where a bank or any other financial institution holding client funds is declared insolvent and is appointed a receiver or another insolvency practitioner.

Safeguarding vs. FSCS Protection

Please note that protection available by Financial Services Compensation Scheme (FSCS) does not apply to client funds held by EMIs.

The reason for that is that EMIs cannot lend their clients’ money, as banks can (and do). Therefore, banks are required by the UK government to insure clients’ deposits by participating in a deposit insurance scheme, which is the FSCS. When a bank fails, it may not have sufficient funds to pay back its clients, as it lent their money. Therefore, the FSCS will step in and pay back up to a certain maximum compensation amount (normally £85,000 for consumers).

EMIs are not required to do so as they do not lend money, therefore clients funds are always available for payback in case an EMI fails. Instead, as noted, EMIs are required to independently apply safeguarding mechanisms.

So, clients funds are separated from the EMIs funds either in a safeguarding account held with an authorised bank or as low risk investments held in a separate account with an authorised custodian. Those funds are appropriately identified and managed on a daily basis and remain protected until you decide to use it.

For more details on the levels of protection, please refer to the FCA’s website at the following link.

For any clarification regarding the above, please contact us at or at +44 20 8068 0921.