AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
If a UK money transfer or e-money firm goes bust, the FSCS does not protect your money; it covers banks, not payment firms. Instead, the firm should have safeguarded customer funds separately, and an administrator returns them, usually after a claims process with a deadline called a bar date. You often recover most of it, but it can take time and the administrator's costs can reduce what you get.
Why the FSCS does not apply
The Financial Services Compensation Scheme protects deposits at banks, building societies and credit unions, up to £120,000 per person per firm. Its own page says it cannot protect e-money or payment services firms. The FCA has said the same: funds held by payment and e-money firms are not directly protected by the FSCS. Most money transfer apps are authorised payment institutions or e-money institutions, not banks, so the scheme does not cover them.
What protects you instead: safeguarding
Authorised payment institutions and e-money institutions must safeguard customer money, keeping it in a separate account or covering it with insurance or a guarantee, according to the FCA's consumer guidance. Small payment institutions are not required to safeguard, so the FCA suggests asking the firm. Safeguarded money is meant to be kept apart from the firm's own money and returned to customers if the firm fails.
New FCA safeguarding rules took effect on 7 May 2026: daily checks that the right amount is safeguarded, monthly reporting, and annual audits for firms holding more than £100,000 of customer funds. The FCA brought them in after finding that insolvent payment firms between 2018 and 2023 had an average shortfall of 65% of customer funds, which shows how badly safeguarding could fail before.
How the administration works
Failed payment and e-money firms can be put into a special administration under the Payment and Electronic Money Institution Insolvency Regulations 2021. Regulation 12 sets the administrator's first objective as returning relevant funds (customer money) as soon as is reasonably practicable.
- The administrator is appointed and usually publishes a notice and a customer page or email.
- It reconciles the safeguarded pool against customer records.
- It may set a bar date, a deadline for customers to submit claims, with a reasonable period to claim after the notice (regulation 20).
- It distributes funds as soon as reasonably practicable after the bar date.
- Late claims made before distribution should be included where practicable; claims after a distribution go into a later one if they would have qualified.
The FCA says customers usually recover most of their money, but it may take time and can be reduced by the administrator's costs.
A worked example
Example only: you hold £600 in a transfer app's wallet and have a £200 transfer to Lagos marked pending when the firm enters administration. Your claim is £800, made up of the balance and the undelivered transfer. Suppose the safeguarded pool covers customers in full but the administrator's costs of distributing it take 5% of the pool. You would receive about £760, and it may come weeks or months after the bar date. If safeguarding had failed and the pool held only 80% of what customers were owed, before costs you would receive £640. These figures are illustrative; the administrator's reports set out the real position.
Keep your evidence
Save confirmation emails, statements and screenshots in one place. Administrators work from the firm's records, but where those are incomplete your own evidence helps settle a disputed balance.
What to do now
- Do not send more money to the firm, and cancel any recurring transfers.
- Screenshot your balance, pending transfers and transaction history while the app still works.
- Find the administrator's notice through the firm's website or the FCA register entry, and follow only official instructions.
- Submit your claim before the bar date, with your account email, balance and transaction references.
- Watch for scams: fraudsters often pose as administrators or "recovery services" that charge a fee. Claims to a genuine administrator do not need a payment from you.
Money in flight and card payments
A transfer you funded but the firm did not deliver is part of your claim. If you paid by debit card shortly before the failure and the service was not provided, ask your bank about a chargeback. MoneyHelper says debit card payments are covered by chargeback, that you should ask the company first, and that the bank can claim within 120 days. A failed firm cannot respond, so explain that to your bank.
If the transfer had already been paid out in Nigeria, the money is with your recipient and is not part of the claim. Ask them to check their statement before you claim for it.
Choosing a provider with this in mind
Check a firm's status on the FCA register before using it; it shows whether it is a bank, an authorised payment institution, an e-money institution or a small payment institution. Avoid leaving large balances in any app for longer than needed. See checking a firm is FCA regulated, safeguarding explained and FSCS cover and remittance apps.
Where Pryme fits
Pryme is a technology company, not a bank. Naira deposits are held by a licensed Nigerian microfinance bank, regulated by the CBN and insured by the NDIC up to the applicable limit; outside Nigeria, Pryme's activities are carried out through regulated partners. See how it works and security.
Questions people ask
Does FSCS cover money transfer apps?
No. The FSCS says it cannot protect e-money or payment services firms. Protection comes from safeguarding instead.
How long does it take to get money back from a failed payment firm?
It varies. The administrator must return funds as soon as reasonably practicable, often after a bar date for claims.
What is a bar date in a payment firm administration?
A deadline the administrator sets for customers to submit claims before a distribution.
Will I get all my money back?
The FCA says customers usually recover most of it, but administrator costs and any safeguarding shortfall can reduce it.
Sources
- FSCS: Check your money is protected · accessed Oct 2026
- FCA: Using payment service providers (updated 8 Jan 2026) · accessed Oct 2026
- FCA press release: changes to payment safeguarding rules (7 Aug 2025) · accessed Oct 2026
- legislation.gov.uk: Payment and Electronic Money Institution Insolvency Regulations 2021, regulation 12 · accessed Oct 2026
- legislation.gov.uk: Payment and Electronic Money Institution Insolvency Regulations 2021, regulation 20 (bar date) · accessed Oct 2026
- MoneyHelper: Using and paying with debit cards · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.