BCB Payments Limited (BCBPL) is supervised by the Financial Conduct Authority as an Authorised Payment Institution (API). BCBPL is committed to conducting business openly, transparently and to the highest standards. As part of this commitment and in order to comply with regulatory requirements we protect any funds we hold on your behalf for the provision of a payments service through a regime mandated by the Payment Services Regulations 2017 and supervised by the FCA called ‘safeguarding’. Unlike holding money in a standard bank account, all of our clients’ funds are protected, regardless of the value.

What is safeguarding?

Safeguarding is the obligation to identify and keep client monies segregated and protected from all other funds that our business may hold. Safeguarding ensures that your funds are always protected and can be returned to you should BCBPL enter into administration or liquidation. This obligation commences as soon as funds are identified as client monies and stops when funds are remitted to the clients’ recipient. BCBP is able to provide segregated accounts by partnering with regulated banks which offer safeguarding services.

How does BCBPL select the banks it partners with?

Protecting our clients’ money at all times is one of BCBPL’s core objectives. We exercise due skill, care and diligence in selecting, appointing and periodically reviewing banks who provide segregated accounts. We ensure that the banks we have carefully selected to partner with are the best fit. All of the banks that we have selected to partner with are authorised credit institutions in the UK, the EEA or another OECD member state.

How does BCBPL select the banks it partners with?

Yes, very strict rules apply to safeguarding accounts.

  • The account must be named in such a way that shows it is a safeguarded account;
  • The account must not be used to hold any other money, other than the monies of our clients;
  • No one (other than BCBPL) has any interest in or right over the funds in the account;
  • The safeguarding account must be held at a bank regulated in an OECD member state; and
  • A letter must be provided by the bank to us confirming the safeguarding status of the account.

Do the banks that BCBPL partners with provide any assurance that they are actually safeguarding funds?

It is a requirement that banking partners warrant that the funds they are safeguarding will not be used to satisfy or offset any other obligation including those obligations imposed on BCBPL itself. This requirement will be fulfilled by the banking partners providing BCBPL with a safeguarding bank/custodian acknowledgement letter.

How would our clients get their money back if BCBPL were to go out of business?

In the event of BCBPL going out of business, a liquidator would be appointed to handle the distribution of BCBPL’s assets. Your money would not be subject to any insolvency claim and would be reconciled and returned to you in full and in a timely and orderly manner.

Are BCBPL clients covered under the Financial Services Compensation Scheme (FSCS)?

No – As an API, we are not in the scope of the FSCS, which has a cap of coverage of £85,000. An API, however, is required to safeguard the entire value of client funds, even where this is above £85,000, so is not subject to a cap.

If you have any further questions or would like to learn more about safeguarding please do reach out to us at [email protected]

Further resources on Safeguarding requirements:

  • Regulation 23 of the Payment Services Regulations 2017
  • Chapter 10 of the FCA Approach Document in relation to Payment Services and Electronic Money

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