Protecting your funds

This page is dedicated to explain how your money is kept and protected in your Payz account, held by PSI-Pay Ltd (“PSI-Pay”) an e-money institution (“EMI”) authorised and regulated by the Financial Conduct Authority (“FCA”).

PSI-Pay is committed to keeping your funds safe and as part of our EMI licence, we have put in place ‘safeguarding’ measures to protect all of our customers’ funds in line with these rules.

What is e-money?

When you send or receive money into your Payz account we give you the value to spend in your Payz account balance. The money held in your Payz account is known as ‘electronic money’ or ‘e-money’. While this may sound similar to what a bank does when funds are received into a current account, we are not a bank and therefore:

  • we do not take your money as a deposit to use for our own purposes or lend to other customers; and
  • your e-money is not covered by the Financial Services Compensation Scheme (“FSCS”).

We use “safeguarding” to protect your money

To ensure your money is safe we follow a process known as ‘safeguarding’ which is a regulatory requirement for all EMIs.

In this process we keep your money separate from PSI-Pay’s own funds that we use for our own business purposes and your funds are protected from the moment we receive your balances, until you either make payout or a withdrawal.

In the event you have not made a payout of redemption request by the next business day, we place your funds into a specially designated ‘safeguarding’ account which will hold those funds until you do so.

The separately held money is only available for the purposes of giving you back your money on your request. It is not available to any of PSI-Pay’s creditors, banking partners or third parties.

It means that whenever you ask us to withdraw your balance or make a payout, that money will be available immediately, subject to our usual checks.

PSI-Pay has robust internal processes to ensure the processes and banks we use to protect your funds are of the highest standard. To ensure our processes are working appropriately we appoint an independent third party expert to check that we are meeting our safeguarding obligations every year and the report issued by the appointed third party confirming this, is available to the FCA on request.


In the unlikely event of PSI-Pay going out of business, an insolvency practitioner would be appointed to return the funds we have safeguarded to you, our customers. The appointed insolvency practitioner would ensure you would get your money back in priority to all our other creditors. Please do note that, however, at that time, the appointed insolvency practitioner may deduct some costs for distributing the money to our customers.

How does safeguarding cover differ from FSCS cover?

You may have heard of the Financial Services Compensation Scheme (“FSCS”). FSCS protects consumers together with certain small businesses, limited companies and charities in the event certain authorised financial services firms (such as UK authorised banks, building societies or credit unions) fails and they cannot return your money to you.

FSCS is a service funded by those financial service firms who are covered by it and acts like an insurance policy to cover balances held up to £85,000 per eligible person, per bank, building society or credit union or up to £170,000 for joint accounts. This means if you have money in multiple accounts with banks, building societies or credit unions that are part of the same group (and share a banking licence) the FSCS treats them as one bank. In the event of a failure, the FSCS aims to pay-out funds to eligible persons within 7 to 15 days depending on the complexity of the case.

Whereas safeguarding protects all the funds held in an e-money account and are safeguarded, the full value (minus administrative costs applied by the insolvency practitioner) will be returned to you in the event that we go out of business. However, because of the insolvency procedure, it may take longer (in comparison to an FSCS claim) for your money to be returned to you.

As PSI-Pay is not a bank and is not covered by the FSCS, in the event of our insolvency, you will not be eligible for the protection under the FSCS. Both the safeguarding regime and FSCS provide different levels of protection and risk but ultimately aim to ensure your funds are protected.

More information

You can find more information about using a non-bank payment service provider on the FCA’s website.

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