Zilch Secures FCA Payments Licence and Visa Membership

Zilch has secured a payments services licence from the Financial Conduct Authority, removing its reliance on third-party arrangements and enabling the company to develop payment methods internally. The London-based consumer payments platform has also become a principal member of Visa for the first time.

The FCA authorisation allows Zilch to build payment products without intermediaries, accelerating its product development timeline and enabling faster market entry for new offerings. The licence positions the company to respond to emerging payment technologies, including stablecoins, as they develop in the market.

The company, which reached quarterly profitability in July 2024, has built its business around what it terms an ad-subsidised payments network. This model combines advertising revenue with payment processing to offer consumers flexible payment options without relying solely on consumer fees.

Zilch plans product launches following FCA authorisation

The licensing arrives as Zilch prepares to launch two products. Zilch Pay, scheduled for the first half of 2026, will offer a one-click checkout experience designed to increase transaction volumes. The company has also developed Intelligent Commerce, an AI platform that converts engagement data into real-time insights for merchants.

The products build on Zilch’s existing infrastructure, which serves over five million registered customers in the UK market. The company reports it is currently adding more than 100,000 new customers monthly and serves approximately 15% of the UK’s working adult population.

The FCA licence grants Zilch direct access to regulatory roadmap discussions and early testing opportunities for new products. This access extends the company’s commercial partnership capabilities within the payments sector.

“This is a major step change for Zilch, bringing us firmly into the payments tent and giving us a true seat at the table to shape the ecosystem,” says Philip Belamant, Co-founder and CEO of Zilch. “It opens the door to new opportunities, setting us up to move even faster, more efficiently and cost-effectively.

“In just five years, we’ve amassed over 5.3 million users and thousands of retail partners based on the strength of our proposition and product,” he says. “Now with our licence, we are even better positioned to develop this further and take advantage of new innovations as they mature to support the next phase of our rapid expansion.”

The company’s growth has been supported by its expanded collaboration with AWS, which enables it to process large volumes of data through AI and machine learning services. Zilch generates over 500 million customer data sets, with 50% of its customer base connected through open banking.

FCA applies bank-level scrutiny to Zilch application

The FCA has tightened its licensing requirements for payments firms in recent years, raising compliance and governance standards across the sector. Zilch faced scrutiny comparable to that applied to new banking applications during its licensing process. The regulator’s approval indicates the company has met these standards for operational governance and regulatory credibility.

Zilch first secured regulatory authorisation through the FCA’s Sandbox Programme in April 2020, which enabled the company to test its consumer credit offering in a controlled environment. The new payments services licence represents a broader authorisation that extends beyond consumer credit to encompass payment processing capabilities.

Visa extends relationship with Zilch through principal membership

Zilch signed a multi-year partnership with Visa earlier this year to launch its first physical payment card and gain access to Visa's global merchant network of more than 150 million locations. The partnership involved migrating Zilch's transaction processing onto Visa's infrastructure, which the company reports has delivered improvements in processing efficiency.

“We’re excited to continue supporting Zilch’s growth to bring new, cutting-edge solutions to the UK market,” says Mark Berry, Head of UK clients at Visa. “Working together, we can deliver smarter ways to pay and be paid for people and businesses across the UK at scale.”

Zilch raises capital and expands partnerships

The licensing follows Zilch’s recent capital raising activities. The company has raised over US$175m in debt and equity, including an expansion of its securitisation facility led by Deutsche Bank. The funding round, led by KKCG with participation from BNF Capital, followed the launch of both Intelligent Commerce and Zilch Pay.

Zilch has also expanded its securitisation facility to £150m through Deutsche Bank, securing additional backing from two global credit funds. The expanded facility will support £10bn in annual commerce through Zilch's payment network, representing a £50m increase from its initial securitisation.

Philip established Zilch as the world's first ad-subsidised payments network in 2020, reaching unicorn status within 14 months of launch. The company’s model generates revenue from advertising and merchant commissions rather than relying solely on consumer fees, enabling it to offer interest-free credit and cashback rewards to users.