Zilch, one of the UK’s rapidly expanding buy-now-pay-later (BNPL) fintechs, has been granted a payment services licence by the Financial Conduct Authority (FCA). According to the company, the move will help them lessen their dependence on third-party providers and greatly speed up their product development roadmap. The licence, which is the result of a regulatory engagement process over several years, is a decisive moment for the London-based company as it aims to become not only a BNPL provider but also a payments platform of a wider scope.
Zilch, which is backed by Goldman Sachs, eBay, and other international investors, has reached a customer base of more than 5 million after only 3 years of operation—an extremely rapid growth in the UK’s heavily regulated consumer-credit market. The recently awarded FCA licence makes Zilch a member of a very small group of fintechs that are permitted to offer payment services directly. This move allows the company to develop and operate its own payment infrastructure without the need to rely on third-party partners for transaction routing, credential issuing, or settlement management.
Greater Autonomy and Speed of Operations
A spokesperson for Zilch claimed that the licence would enable the company to bring more payment methods in house, lower their administrative costs, and reduce the time needed to launch new features. This news comes ahead of the 2026 launch of Zilch Pay, a one-click checkout tool that aims to make online purchases faster and easier, and at the same time, integrate both debit and BNPL functionalities.
Philip Belamant, co-founder and CEO, saw the licence as a game changing moment:
“For Zilch, this is a significant change of gear, integrating us fully into the payments arena and giving us an actual role in decision-making to influence the ecosystem. The permission facilitates new prospects, preparing us to operate at an even higher speed, with greater efficiency and lower costs.”
Industry experts highlight three significant benefits of obtaining direct payment authorisation: firstly, the enhanced cost efficiency resulting from the removal of intermediaries; secondly, increased product flexibility; and thirdly, a more robust risk-management framework. Besides, it also gives Zilch a better position in front of regulatory reforms that the UK government is going to introduce for the BNPL sector, which will likely be characterized by stricter affordability assessments and more transparency requirements.
Building a Stronger Relationship With Visa
Besides the FCA green light, Zilch also revealed that it obtained Principal Membership with Visa— the highest level of partnership within the card network’s ecosystem. In the early part of this year, Zilch made an official move from Mastercard to Visa as its main network partner.
As a Principal Member, Zilch can issue Visa cards directly and possibly work together with the network in developing new payments capabilities. The card issuer anticipates the expanded relationship to facilitate innovations in areas such as digital checkout, fraud prevention, and seamless credit integration.
Visa has been deliberately partnering with new fintechs to take advantage of the growth in alternative lending and flexible payment solutions. The partnership means a lot to Zilch in terms of both validation and technical leverage, especially when considering their international expansion plan, as foreign countries might be more willing to work with the two big names in the fintech space rather than one only.
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This news comes shortly after Zilch’s $175 million equity and debt round in November that was mainly supported by the Czech investment group KKCG while BNF Capital and some other strategic investors also participated in it. This financing round, which is one of the most significant in European fintech in 2024–2025, set the company’s valuation at a level that allows further growth as well as the possibility of buying other companies.
Zilch declared that the money raised would be funneled towards accelerating the product roadmap, strengthening the company’s financial position, and scouting potential acquisition targets—a clear indication of the consolidating trend in the BNPL and embedded-finance sectors. The rise of competition from the likes of Klarna, PayPal, and Apple Pay Later has made it almost impossible for companies to differentiate themselves without resorting to factors such as technology, regulatory positioning, and partnerships.
A Turning Point for UK BNPL Regulation and Innovation
The moment Zilch received its FCA licence is very significant for the UK BNPL industry, which is moving forward the stage of a lightly regulated environment to one with more formal consumer-protection frameworks. By getting a full payment services authorisation, Zilch is in a better position than most of its competitors, who are still waiting for regulatory clarity.
While Zilch is getting ready to debut new offerings and strengthening its ties with Visa’s worldwide payments network, the company’s goal is to become a general-purpose payments and credit platform rather than just a BNPL specialist. With the regulator’s green light, new strategic partnerships, and fresh capital, Zilch is making it clear that it has one main goal: to be at the forefront of the next UK and European consumer payments stages.