Most UK payments firms miss FCA safeguarding rules
Wed, 6th May 2026
Kani Payments has published research suggesting most UK payments firms are not meeting new Financial Conduct Authority safeguarding requirements, highlighting a gap between firms' confidence and their operational readiness.
A survey of compliance and finance leaders at FCA-regulated firms found that 32% believed they were already compliant with the updated CASS 15 rules. Still, only 13% were carrying out the daily reconciliations required by the regime.
The revised safeguarding framework is now taking effect for payments companies, placing greater emphasis on daily reconciliation, stronger record-keeping and the ability to produce evidence quickly under regulatory scrutiny.
Although awareness of the rules appears high, the study suggests many firms still rely on processes built around periodic reporting rather than daily controls. While 84% of respondents believed they could explain their safeguarding calculations to an auditor, many still depend on spreadsheet-led workflows.
Only 36% said they had instant or near-instant access to a complete safeguarding evidence pack. That matters because the FCA expects safeguarding resolution packs to be produced within 48 hours.
Spreadsheet reliance
Nearly two-thirds of respondents (64%) said they still use spreadsheets for safeguarding processes. Among firms relying solely on spreadsheets, two-thirds said they need at least six hours to compile the required data, while one-third said the process takes more than a full working day.
The figures suggest that even where firms understand the rules, many may struggle to meet the regulator's expectations at short notice. Spreadsheet-based systems are not automatically non-compliant, but they can make it harder to maintain consistent daily oversight and a clear audit trail.
Among businesses using spreadsheets alone, 22% said they were not confident their reports would withstand audit scrutiny. The research points to a sector in which compliance teams may believe they are prepared, even as underlying processes remain slow and heavily manual.
Operational change
The updated safeguarding approach marks a shift from a periodic compliance exercise to a continuous operational requirement. For firms whose back-office systems were designed around weekly or monthly cycles, that means more than simply increasing the frequency of existing tasks.
It requires reconciliation, data collection, exception handling and reporting processes that run consistently every day. The challenge is particularly acute for payments companies that have expanded quickly while retaining manual controls in finance and compliance functions.
In that context, the research highlights a mismatch between board-level confidence and day-to-day operational practice. Firms may be familiar with the wording of the rules, but the ability to produce accurate reconciliations and supporting evidence on demand appears far less common.
Aaron Holmes, Chief Executive of Kani Payments, said the survey revealed a clear gap.
"This is a clear case of confidence outpacing capability. Firms understand the rules, but many are not yet operating in a way that meets them," said Holmes.
"When only one in eight firms is reconciling daily, but daily reconciliation is about to become the standard, that is not a marginal gap - it is a structural issue. Treating this as a reporting upgrade misses the point. This is an operational shift. Firms need to move from periodic processes to continuous control."
The findings also underscore how quickly firms may be exposed if a regulator requests detailed evidence. A business that needs hours, or even a full day, to assemble safeguarding records could face pressure in a regime that expects information to be available much faster.
Holmes added that the issue cannot be solved simply by speeding up old working methods.
"You cannot simply accelerate a weekly process and expect it to meet daily requirements. Firms need systems and controls that are built for consistency, not manual assembly. The deadline is here, and the FCA has been clear about its expectations. Firms that have not adapted risk falling behind very quickly."