An employee demonstrates the Wirecard AG online payment smartphone app on the company’s exhibition stand at the Noah Technology Conference in Berlin, Germany, on Thursday, June 13, 2019.
Krisztian Bocsi | Bloomberg via Getty Images
Wirecard has been given permission to carry out regulated activities in the U.K. again following a decision from regulators to lift restrictions on the firm.
The Financial Conduct Authority (FCA) said Tuesday that it had provided Wirecard’s U.K. subsidiary, Wirecard Card Solutions, written consent to resume e-money and payment services, though some restrictions still remain in place. The watchdog had forced the firm to halt operations on Friday after its parent company filed for insolvency in Germany.
The move means that thousands of Brits who had been locked out of financial technology services will soon be able to access their cash again. The shutdown affected several fintech start-ups, including Curve, Pockit, Anna and Morses Club’s U Account. Curve however had managed to get around the restrictions by switching payments processor over the weekend.
“There may be a delay before all card programmes are fully operational, so some customers could find themselves unable to transact immediately but we anticipate this lasting no longer than 24 hours,” Wirecard Card Solutions said in a statement Tuesday. “We apologise for the inconvenience to our valued customers that the temporary suspension caused.”
Despite the relaxing of restrictions from the FCA, experts have said the issue could have lasting damage on people’s trust of fintech companies. Apps like Curve and Anna rely on e-money licenses to handle payments but they don’t have banking licenses of their own to hold customer funds. The money is instead ringfenced with a third-party bank.
Munich-based Wirecard has said it will continue to operate despite opening insolvency proceedings. The firm collapsed into insolvency last week after revealing a 1.9 billion euro ($2.1 billion) hole in its balance sheet. Former CEO Markus Braun is currently out on bail after having been arrested in Munich.
The company has said it is examining whether subsidiaries will need to apply for insolvency as well. Wirecard’s North America unit, which it bought from Citigroup in 2016, said late Monday that it was seeking a buyer.
Meanwhile in Singapore, the central bank has said that Wirecard is assessing its ability to continue providing services in the country after the insolvency filing by its parent company. Wirecard’s Singapore unit found itself at the heart of an investigation in accounting irregularities last year. The Monetary Authority of Singapore is working with police to scrutinize Wirecard’s local operations.