What happens if your money app goes bust?

Who this guide is for

This guide is designed for people who:

• use a money app, e-wallet or prepaid card and want to know how their balance is protected
• hold money in savings pots or spaces inside an app and aren't sure which firm actually holds it
• have seen news about an e-money firm entering special administration and want to understand the process

Who may not need this guide

This guide may be less useful for people who:

• only hold money with a bank or building society they have already checked with the FSCS protection checker
• are looking for how investments, pensions or insurance are protected, as different FSCS rules and limits apply to those

The catch

Bank account vs e-money account at a glance

The table below sets out the main differences between money held in a bank account and money held in an e-money account.

Check who holds your money

What is an e-money institution?

Electronic money, or e-money, is money stored electronically, usually in an online account, a digital wallet or on a prepaid card. You can use it to pay for goods and services, and the FCA notes that e-money institutions (EMIs) can also provide non-bank current accounts.

E-money is now widely used. In PS25/12, the FCA said the proportion of consumers using a payment account with a payments firm grew from 1% in 2017 to 12% in 2024, that about 1 in 10 e-money holders use an e-money account as their main day-to-day account, and that e-money institutions safeguarded about £26 billion of customer funds in 2024, up from £11 billion in 2021.

Banks and EMIs can look alike in an app, but they are authorised differently. A bank takes deposits and is authorised by the Prudential Regulation Authority (PRA) and the FCA. An EMI issues e-money and is authorised or registered by the FCA.

The FCA also describes two other types of non-bank payment firm:

• Authorised payment institutions (APIs), such as money remitters that send money abroad. They must safeguard customers' money.
• Small payment institutions (SPIs), which have limits on the value of payments they can handle. They don't have to safeguard customers' money, although some choose to.

How money in a bank account is protected

Deposits with UK banks, building societies and credit unions authorised by the PRA are covered by the FSCS. On 1 December 2025 the deposit protection limit rose to £120,000 per eligible person, per authorised firm.

A few details are worth knowing:

• Joint accounts are covered up to £120,000 for each account holder.
• Some banking groups run several brands under one banking licence. The FSCS treats those brands as one bank, so the £120,000 limit applies to the total across all of them.
• Temporary high balances, such as money from a house sale or an inheritance, can be covered up to £1.4 million for up to six months.
• The FSCS says it usually returns money automatically, within seven days.

Our FSCS protection limits guide covers the limits in more detail.

How safeguarding works

E-money institutions and authorised payment institutions must safeguard the money they receive from customers. The FCA says they can do this in one of two ways:

• Segregation: keeping customers' money separate from the firm's own money, typically in a dedicated safeguarding account with a bank.
• Insurance or guarantee: arranging for customers' money to be covered by an insurance policy with an authorised insurer, or a comparable guarantee.

Under the FCA's strengthened rules, in force since 7 May 2026, these firms must also:

• reconcile their safeguarded money at least once each reconciliation day, which excludes weekends, bank holidays and days when relevant foreign markets are closed
• keep an up-to-date resolution pack to help return money quickly if they fail
• arrange an annual safeguarding audit by a qualified auditor, unless they have not had to safeguard more than £100,000 at any time over a period of at least 53 weeks
• send the FCA a monthly return on their safeguarding arrangements and the customer funds they hold

There is one extra layer to be aware of. The FSCS says it may protect safeguarded money if the bank holding that safeguarding account fails. That covers the bank's failure, not the failure of the e-money firm itself.

What is the Payment and E-money Special Administration Regime?

The Payment and Electronic Money Institution Insolvency Regulations 2021 (SI 2021/716), in force since 8 July 2021, created a special administration regime for payment and e-money institutions. The FCA describes it as similar to an ordinary administration, with extra objectives.

A court (the High Court in England and Wales, or the Court of Session in Scotland) appoints the special administrators, who act as officers of the court. Under the 2021 Regulations they have three objectives:

• Objective 1: return customers' money (known as relevant funds) as soon as is reasonably practicable.
• Objective 2: engage in a timely way with payment system operators, the Payment Systems Regulator and the Authorities, which the Regulations define as the Bank of England, the Treasury and the FCA.
• Objective 3: either rescue the firm as a going concern or wind it up in the best interests of its creditors.

The Regulations say the order of these objectives isn't significant, and administrators must start work on all three straight away. In the ePayments case, the FCA said the firm remains authorised and subject to its rules during the process.

The regime has been used several times recently. FCA notices show that Ziglu Limited, authorised to issue e-money and provide payment services, entered special administration on 7 July 2025, and Argentex LLP, authorised to provide e-money and payment services, entered special administration on 21 July 2025.

What happens to customers' money

When an e-money firm enters special administration, customers may lose access to their accounts while the administrators take control. Their first job is to reconcile the money held in safeguarding accounts against what each customer is owed.

The administrators then set out how customers can make a claim. Money is paid back from the pool of safeguarded funds. The FCA says safeguarding means customers should get most of their money back if a firm fails, but it may take some time and may not be the full amount, because some costs could be taken by the administrator or liquidator. In the Argentex special administration, the FCA said there are costs associated with returning funds to customers and that, under the law, these costs will be deducted from the relevant funds held by the firm.

The FCA says that for most customers there is no benefit in paying a third party, such as a claims firm, to make a claim. It also warns that scammers may pose as the firm, the administrators or the FCA.

A recent example: ePayments

On 15 October 2026, ePayments Systems Limited (EPS) entered special administration. Mark Boast and Allister Manson of Opus Restructuring LLP were appointed as joint special administrators under the Payment and Electronic Money Institution Insolvency Regulations 2021.

The FCA confirmed that EPS is authorised to issue e-money under the Electronic Money Regulations 2011. It also confirmed that customers' money is not covered by the FSCS, because the FSCS does not cover payment services. EPS was instead required to safeguard customers' money.

According to the administrators, EPS stopped all customer trading in September 2022 and had been returning safeguarded money since then. Accounts have now been frozen while the administrators reconcile the safeguarded funds. They say the timing and amount of any return to customers is uncertain at this stage, and will depend on the balance left in the customer funds account and the costs of returning the money.

The FCA's news story on ePayments lists the administrators' contact details.

How to check a firm on the FCA Register

A brand name in an app isn't always the name of the regulated company. The FCA suggests looking for the name of the company behind the brand, which is usually at the bottom of the provider's website or in its terms and conditions.

Searching that company name on the FCA Register shows whether it is a bank or a non-bank payment provider, such as an e-money institution. The FSCS says that if a firm doesn't appear in its protection checker, its deposit protection may not apply.

Partner banks add another layer. The FSCS notes that some e-money and payment firms let customers hold money with other firms, which may be FSCS-protected banks, from inside their app. A pot's name doesn't matter. What matters is which firm holds the money and how.

Where money sits with a partner bank, the FSCS suggests asking whether it is held directly in the customer's name or under a trust arrangement. With trust arrangements, the FSCS says its payout can take longer, up to three months.

Practical points to consider

People often find it helpful to know three things about each app they use:

• The legal name of the company that holds the money, and whether the FCA Register lists it as a bank or an e-money institution.
• Where any savings pots are held, and whether that firm is a bank covered by the FSCS.
• Whether two apps send savings to the same partner bank, as the FSCS limit applies once per banking licence.

For larger balances, the Bank of England notes that people with eligible deposits above the protection limit may wish to split them across different PRA-authorised firms.

In the ePayments case, the administrators asked customers to tell them the balance they believed was held, along with any supporting documents. The administrators said that providing this information does not count as proof of a claim and will not speed up any return.

If a payment provider has gone out of business, MoneyHelper offers free guidance. Complaints about an EMI or payment firm can go to the firm first and then, if unresolved, to the Financial Ombudsman Service.

For more on how different accounts work, see our banking guides, our current accounts guide and our guide to startup banks.

Frequently asked questions

Is money in an e-money account protected by the FSCS?

No. Money held with an e-money institution is safeguarded, not FSCS-protected. The FSCS protects deposits with UK banks, building societies and credit unions authorised by the Prudential Regulation Authority. E-money firms must instead safeguard customers' money, by keeping it separate from their own or covering it with an insurance policy or comparable guarantee, so that it is held for customers if the firm fails. If the firm does fail, any money returned may take some time and may not be the full amount.

How much does the FSCS protect in a bank account?

Since 1 December 2025, the FSCS can compensate eligible depositors up to £120,000 per person, per authorised firm. Joint accounts are covered up to £120,000 for each holder. Brands that share one banking licence count as one firm, so the limit applies across all of them.

How long does it take to get money back if an e-money firm fails?

It varies from case to case. The FCA says money returned through safeguarding may take some time and may not be the full amount, because some costs could be taken by the administrator or liquidator. For comparison, the FSCS says it usually pays eligible bank depositors automatically within seven days.

What is special administration for an e-money firm?

It is an insolvency process created by the Payment and Electronic Money Institution Insolvency Regulations 2021. A court appoints special administrators, whose objectives include returning customers' money as soon as reasonably practicable and engaging in a timely way with payment system operators, the Payment Systems Regulator and the authorities.

Sources

• ePayments Systems Limited enters special administration — FCA
• ePayment Systems Ltd (in Special Administration) — Opus Restructuring LLP (joint special administrators)
• Jarvis Investment Management Limited enters special administration — FCA
• Legal notice — Jarvis Investment Management Ltd (JSAs legal notice)
• Using payment service providers — FCA
• Safeguarding requirements for payment institutions and e-money institutions — FCA
• PS25/12: Changes to the safeguarding regime for payments and e-money firms — FCA
• PS25/12 (PDF), paragraph 2.3 — FCA
• The Payment and Electronic Money Institution Insolvency Regulations 2021 (SI 2021/716) — legislation.gov.uk
• SI 2021/716 regulation 12: special administration objectives — legislation.gov.uk
• Deposit protection limit — FSCS
• What is the FSCS and what is the new deposit protection limit? — Bank of England
• PRA confirms FSCS deposit limit to be increased to £120,000 from 1 December — Bank of England / PRA
• Keeping track of your (e)money and its FSCS protection — FSCS
• What if my bank just exists online? — FSCS
• Can't find your bank, building society or credit union? — FSCS
• Financial Services Register — FCA
• Ziglu Limited enters special administration — FCA
• Argentex LLP enters special administration — FCA
• SI 2021/716 regulation 6: definitions (Authorities; court) — legislation.gov.uk
• EPAYMENTS SYSTEMS LIMITED (08134141) — Companies House (GOV.UK)