After Brexit and Wirecard, An Publish switches issuer for forex card

The impacts of Brexit and the collapse of Wirecard triggered many complications for fintech providers in latest months.

An Publish lately switched issuer for its An Publish Cash Foreign money Card, a number of months after the Wirecard debacle disrupted its providers and as Brexit loomed.

Like many cost and card providers, An Publish’s pay as you go Cash Foreign money Card had been utilizing a UK-based issuer, on this case Wirecard Card Options (WCS).

Final June, WCS was briefly suspended by the Monetary Conduct Authority (FCA) within the UK amid the storm surrounding its mum or dad firm Wirecard – the German fintech large that was embroiled in a €1.9bn accounting fraud scandal.

In consequence, the providers of many WCS prospects, together with huge fintech gamers like Revolut and Curve, have been disrupted. An Publish was caught within the crossfire, with round 50,000 Cash Foreign money Playing cards being briefly frozen.

The FCA would go on to revive WCS’s operations however the fintech business wasn’t out of the woods but. Wirecard’s dramatic fall from grace noticed the corporate collapse into insolvency with belongings offered off. The disruption to different divisions of the Wirecard enterprise additionally hit taxi app Free Now.

In August, British open banking start-up Railsbank swooped in and picked up WCS and its shoppers within the course of.

However there was one other problem for a lot of fintech firms and providers. As Brexit quick approached, some would additionally want to change from a UK issuer to an EU-based one as passporting rights for monetary providers have been to be misplaced.

For its Cash Foreign money Card, An Publish engaged with digital cash establishment PrePay Options (PPS), first within the UK after which switching once more to its Belgian authorised entity on the finish of December, days earlier than the Brexit transition interval ended.

“The swap was made on 5 November from Wirecard (UK) options to PPS UK and subsequently on 20 December from PPS UK to PPS EU. There was no disruption to prospects. All prospects have been communicated with prematurely in relation to each occasions,” a spokesperson for An Publish mentioned.

“The transfer to PPS EU was required as a result of, post-Brexit, PPS UK might no lengthy passport their funds licence to EU nations.”

Me2You, Retail Excellence’s present card which additionally skilled disruptions final June, determined to stay with WCS’s new proprietor Railsbank, in line with somebody conversant in the choice. The UK firm shifted the Irish present card service over to certainly one of its subsidiaries, PayrNet, a Lithuanian licensed card issuer.

The frenzy for licences

All of this from side to side has been a typical function for fintech start-ups, cost suppliers and card issuers since 2016, in search of new licences to make sure their providers might proceed to function in Europe as soon as Brexit took impact and the transition interval ended.

A number of firms have turned to Eire for various approvals, with the Central Financial institution of Eire issuing greater than a dozen e-money licences within the final three years. Corporations together with Coinbase, Sq. and Soldo have all secured approvals in Eire to maintain the lights on for his or her EU providers.

Lithuania’s central financial institution has additionally emerged as a preferred vacation spot for firms and their European operations. E-money licences will be secured in round three months in Lithuania, whereas different regulators can sometimes take 12 to 18 months. Curve, Google Funds and Revolut have all obtained licences within the nation.

Revolut mentioned final yr that it was transferring Irish accounts to its Lithuanian e-money enterprise resulting from Brexit, however the firm is within the technique of making use of for a licence from the Central Financial institution of Eire.