UK fintech Plum gets an e-money license from the City watchdog

The Plum smart money application has succeeded in obtaining an electronic money license from the City supervisor, AM City can reveal it, even as the volume of application approvals plummets.

Plum – founded by former Wise banking chief Victor Trokoudes in 2016 – has received permission to operate as an Electric Money Institution (EMI) from the Financial Conduct Authority (FCA).

This move gives Plum the green light to operate as a bank with a narrower scope through offering online transfers, prepaid cards and digital wallet management.

This London-headquartered fintech has more than 2 million customers, automating “difficult” personal finances.

Trokoudes said the new license is a “major milestone” that will allow the company to “expand its reach [its] further services and offers new features.”

Plum pocketed revenues of £12.8 million for the last financial year, according to Companies House filings. This is more than double the £6.2 million in the previous year.

The fintech, which has 169 employees, made a loss of £9.6m in the same period, down slightly from £14.3m a year earlier.

Plum beats regulatory frustration

Earlier this year, Klarna received similar approval from the regulatory agency allowing it to accelerate its transition to a digital bank.

But companies have had difficulty getting approval from regulators.

AM City it was revealed in September that only six e-money license applications had been granted by the FCA over nine months.

The data also reveals not a single EMI license was granted in the fourth quarter of 2024, although there were at least 10 applications under consideration at that time.

This important license allows the company to provide payment services and issue electronic money, making it an important hurdle for fintech startups in the UK.

The regulatory problems for young companies come despite Chancellor Rachel Reeves’ mission to overhaul regulations and “cut red tape” across the city.

Reeves unveiled his reform package for the fintech industry as part of his Financial Services Growth and Competitiveness Strategy in July.

Last week, the Treasury Department laid out new plans for short-term licenses that would allow fintech startups to start taking action before receiving full approval.

But the deregulation efforts have been criticized for failing to have a positive impact, with concerns growing across the sector as the UK’s ranking falls in global rankings.

Industry leaders tell AM City “there is no room for complacency” after new data from think tank Z/Yen showed Singapore, Hong Kong and Shenzhen have surpassed London in global fintech rankings.