Modulr, the Payments as a Service API platform for digital businesses, has became a direct participant in the Faster Payment Service (FPS) on Friday 7th June 2019.
Modulr is one of a small number of non-bank payment service providers (PSP) to hold an account in the Bank of England’s (BoE) Real-Time Gross Settlement (RTGS) system, allowing the fintech to settle payment obligations in central bank money under its Modulr FS Limited entity (FRN 900573). This follows an assessment by the Financial Conduct Authority (FCA).
This has been achieved under a new settlement account policy directive initiated by the BoE that enables direct access to payment systems through provision of settlement accounts to non-bank PSPs. Direct access for PSPs is a key part of the broader policy objectives for the BoE, FCA, the Payment Systems Regulator (PSR) and Her Majesty's Treasury (HM Treasury) to enable greater competition and innovation in UK payments.
Modulr will now process payments without going through a commercial bank, providing clarity on the location and protection of the funds. In addition, Modulr will technically connect directly to the payment schemes removing the operational reliance on third-party bank systems. Following an initial live proving period, Modulr will migrate its existing sort codes, accounts and transaction volume to the direct access solution.
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