UK-based fintech firm Plum has received authorization from the Financial Conduct Authority to operate as an Electronic Money Institution.

This development places Plum among a select few companies that have obtained such approval amid a period of reduced licensing activity. According to City AM, only six e-money licenses were issued by the FCA in the first nine months of 2024, with no new permissions granted in the final quarter despite numerous applications pending. The authorization for Plum mirrors a similar decision earlier this year for Klarna, enabling the Swedish firm to expand into broader digital banking services.

Regulatory Landscape Under Scrutiny

The FCA’s hesitance in issuing new licenses has garnered increasing attention within the industry. Despite governmental promises of more supportive regulatory policies, such as simplifying rules and enhancing competitiveness, industry representatives have highlighted that progress remains limited. A recent assessment by Z/Yen ranked Singapore, Hong Kong, and Shenzhen above London in fintech rankings, underscoring the potential risks for UK firms.

With its new permission, Plum can now offer payment services, issue electronic money, and operate digital wallets—capabilities closely aligned with traditional banking functions. Founded in 2016 by a former senior executive from Wise, Plum boasts over two million customers using its automated financial tools.

The company reported revenue of £12.8 million for the fiscal year ending March 2024, up from £6.2 million the previous year. Plum’s annual loss was reduced to £9.6 million, compared to a loss of £14.3 million in the previous period, and it employed 169 staff during this time.