dLocal Secures UK Payments Licence in Cross-Border Push

The Uruguay-based cross-border payments company dLocal has obtained a payment institution licence from the UK's Financial Conduct Authority, marking a step forward in its global expansion strategy.

dLocal will onboard UK merchants through a local entity, dLocal Opco Ltd UK, which was previously unable to onboard clients locally because of restrictions placed on it by the FCA. dLocal said the restrictions were the result of the UK's exit from the EU.

The licence allows the firm to onboard UK merchants directly for the first time, following previous restrictions related to Britain's departure from the European Union.

Emerging markets focus 

dLocal specialises in facilitating cross-border transactions for merchants operating in developing economies across Latin America, Africa, and Asia. Its platform enables businesses to accept customer payments in local currencies while receiving settlements in major global currencies.

The company has built its business model around emerging market payment flows since its establishment in 2016, with a particular focus on markets such as Brazil, Mexico, Colombia and Uruguay. These regions present specific regulatory requirements and infrastructure challenges for international merchants.

Pedro Arnt, dLocal's CEO, says the company's focus on emerging markets creates a distinct position in the UK payments sector. "The differentiating factor for us when we think of our UK base of merchants is that the geographies where we serve them, and those are the only geographies we work," says Pedro.

UK market entry and expansion 

The UK market represents a strategic opportunity for dLocal, with Pedro noting that "the UK has become a hub for many global companies — even the American companies, some Asian companies — for their emerging market expansion, primarily in Africa, and in some cases LatAm."

The company has established a presence in London, with Chief Operating Officer Carlos Menendez and Chief Revenue Officer John O'Brien based in the city. The firm employs over 1,000 people globally and holds over 30 licences and registrations worldwide.

In the UK payments sector, dLocal will operate alongside established payment technology firms such as Worldpay, which processes in-store and online payments globally, Checkout.com, which provides payment processing services to enterprise clients, PayPal, Stripe, Adyen, Mollie and Revolut.

Market position 

dLocal completed its initial public offering on the Nasdaq in 2021, achieving a valuation of US$9bn at listing. The company's market capitalisation now stands at US$3.4bn, with its shares increasing by 40% over the past six months.

Recent market speculation has suggested potential acquisition interest in the company. However, Pedro addresses these reports directly: "While there would be a fiduciary duty to shareholders to entertain takeovers," he says, "the company is not for sale."

The FCA authorisation positions dLocal to onboard UK merchants through its local entity for the first time, marking a significant regulatory milestone for the company's expansion into developed markets while maintaining its emerging markets payment infrastructure focus.

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