We are not an authorised deposit holder or Bank that offers access to the Financial Services Compensation Scheme (FSCS). To ensure there isn’t any confusion on this point, the following terms apply to our services and have been added to our terms and conditions.
How your funds are protected
Depending on the specific services you use with QU Money, the responsibility for safeguarding your funds will sit either with UKFX Holdings Limited or with our regulated partner, Currencycloud (The Currency Cloud Limited).
Virtual IBANs and Named Wallets: When you use our Virtual IBANs and wallets that are opened directly in your name, we provision these accounts through Currencycloud. In these instances, Currencycloud is fully responsible for holding and safeguarding your funds. Currencycloud is an authorised Electronic Money Institution (EMI), regulated by the Financial Conduct Authority (FCA).
Other Services: For other transactions where funds are held directly by us, UKFX Holdings Limited is responsible for safeguarding your funds in accordance with strict regulatory requirements.
We have addressed some common questions that customers may have about how their money is protected below.
What is E-Money?
When you send money to your account, you are given the equivalent value to spend or transfer. The money held in your account is known as ‘electronic money’ or ‘e-money’. While this may sound similar to what a bank does when funds are received into a current account, this is not a traditional bank account and therefore:
Your money is not taken as a deposit to be used for our own purposes or lent to other customers; and
Your e-money is not covered by the Financial Services Compensation Scheme (FSCS).
How do you protect my money?
Whether your funds are held by UKFX Holdings Limited or Currencycloud, the safeguarding process remains the same. Safeguarding is a strict regulatory requirement designed to protect you.
The institution responsible for your funds separates your money entirely from their own company funds. Your money is placed into dedicated safeguarding accounts held with reputable UK and EU banks. These banks and authorised credit institutions have no rights over the funds in these safeguarding accounts.
Furthermore, both UKFX Holdings Limited and Currencycloud are required to have an independent expert check that safeguarding obligations are being met every year, and these reports are available to the FCA upon request.
In the unlikely event that the institution holding your funds (either UKFX Holdings Limited or Currencycloud) were to become insolvent, the safeguarded funds would form a protected asset pool. Claims from e-money holders (like you) would be paid from this pool above those of other creditors.
This means you would get most of your money back, except for the administrative costs deducted by the appointed insolvency practitioner for distributing the money.
You can read further specifics on how Currencycloud manages this process on the Currencycloud Safeguarding Funds page.
How does FSCS cover differ from safeguarding?
The FSCS protects consumers together with small businesses, limited companies, and charities (that meet its eligibility criteria) when certain authorised financial services firms (such as an authorised UK bank) fail and cannot return your money to you. The FSCS provides compensation only up to £85,000 per eligible person, per bank, building society or credit union, or up to £170,000 for joint accounts.
By contrast, all of the funds held in an e-money account are safeguarded and protected, regardless of the value. The full value (minus administrative costs applied by the insolvency practitioner) will be returned to you in the event the holding firm goes out of business. Because of the insolvency procedure, it may take longer (as compared to an FSCS claim) for your money to be returned to you.
You can find more information about using a non-bank payment service provider on the FCA’s website.
If you have any questions or require clarification on which entity is safeguarding a specific transaction, please contact us on 0207 183 2790 or manager@qumoney.com.
If you have any questions, please contact us per clause 2.2