FinTech Compliance: Navigating FCA and PCI DSS Standards

Compliance in FinTech isn’t just about following rules—it’s about survival. Customers trust you with their most sensitive data, regulators watch your every move, and one misstep can cost millions in fines. If you’re building or scaling a FinTech company, understanding the Financial Conduct Authority (FCA) and Payment Card Industry Data Security Standard (PCI DSS) frameworks is non-negotiable.

This guide shows you how to navigate both with clarity, using real-world examples, pitfalls to avoid, and an actionable framework to stay compliant while growing fast.

FinTechs must comply with FCA regulations to operate legally in the UK and meet PCI DSS standards to secure payment data. Success requires building compliance into your processes from day one, continuously SaaS performance monitoring risks, and leveraging technology for automation.

• The global RegTech market helping firms meet compliance will hit $28.9 billion by 2025 (2024, Statista).
• 73% of FinTechs face increased scrutiny from regulators after rapid digital adoption post-2020 (2023, PwC).
• PCI DSS version 4.0 became mandatory in March 2025, with stricter authentication and risk assessments (2025, PCI Security Standards Council).
• UK FCA issued fines totaling over £215 million against financial firms in 2024 for compliance breaches (2024, FCA).
• 58% of customers say they won’t trust a FinTech provider that’s been fined for compliance failures (2023, Deloitte).

In the fast-paced world of financial technology, compliance is more than a regulatory hurdle—it’s a business enabler. Customers entrust FinTech platforms with sensitive financial data, investors demand risk-free scalability, and regulators closely monitor digital-first providers. One weak link in compliance can trigger devastating consequences: an FCA investigation over poor anti-money laundering (AML) checks, or penalties from card networks for failing PCI DSS encryption standards.

The stakes are even higher for FinTechs compared to traditional banks. Startups often grow at lightning speed, scaling products, onboarding thousands of users, and handling complex transactions across borders. Without compliance baked into the foundation, growth can quickly turn into vulnerability. In fact, 73% of FinTechs reported facing heightened regulatory scrutiny after accelerated digital adoption (PwC, 2023).

Rather than slowing innovation, compliance with FCA and PCI DSS frameworks actually empowers FinTechs to expand safely. Done right, it builds customer trust, operational resilience, and investor confidence—all critical for long-term success.

The Financial Conduct Authority (FCA) is the UK’s primary regulator for financial services. Its mandate is to ensure that firms act with integrity, treat customers fairly, and maintain the stability of financial markets. For FinTechs, obtaining and maintaining FCA compliance is proof of legitimacy in one of the world’s most sophisticated financial ecosystems.

Key FCA Areas for FinTechs

• Authorization – Every FinTech offering regulated services such as lending, payments, or wealth management must apply for FCA approval before going live. Operating without authorization can result in criminal penalties.
• Consumer Duty (2023 update) – Firms must prioritize good customer outcomes, shifting the focus from “avoiding harm” to actively delivering value. This requires transparent pricing, accessible communication, and fair treatment.
• AML and KYC Controls – With financial crime risks on the rise, rigorous AML and Know Your Customer (KYC) processes are non-negotiable. FCA expects advanced identity verification, real-time monitoring, and suspicious activity reporting.
• Prudential Standards – FinTechs must demonstrate adequate capital buffers to withstand losses and protect customer deposits, ensuring long-term financial resilience.
• Operational Resilience – Given the reliance on digital systems, the FCA mandates firms to prove they can withstand disruptions, cyberattacks, or outages while continuing to serve customers.

Revolut, one of the UK’s most recognized FinTech unicorns, illustrates how compliance gaps can slow growth. Despite its global expansion, Revolut faced delays in securing a full UK banking license due to concerns about its compliance and governance systems (Financial Times, 2023).

This example highlights two key lessons:

• Compliance is not optional—even for market leaders. Regulators will scrutinize operational resilience, AML systems, and governance structures before granting full authorization.
• Investor and customer trust hinges on compliance. Any delay or fine tied to weak systems can erode confidence in even the most successful FinTech brands.

If your FinTech processes, stores, or transmits cardholder data, PCI DSS compliance is essential.

essential. PCI DSS 4.0 Updates (2025)

• Multi-Factor Authentication required for all access to card data.
• Continuous Risk Assessments instead of annual reviews.
• Stronger Encryption for stored and transmitted data.
• Customized Approaches allowed, but with stricter validation.

Why It Matters

A single PCI DSS breach can lead to fines from card networks, reputational damage, and loss of partnerships with banks and payment processors.

Example

In 2024, a US-based FinTech software company faced over $5 million in fines after failing to patch vulnerabilities in its card payment system, leading to a breach of 2 million users’ data.

For FinTech startups, compliance cannot be treated as a one-time project or a “tick-box” exercise. In today’s fast-moving regulatory environment—where FCA fines exceeded £215 million in 2024 and PCI DSS 4.0 introduced stricter requirements in 2025—non-compliance is both costly and reputation-damaging. The most effective approach is compliance-by-design, embedding FCA and PCI DSS standards into your operations from day one.

Why Compliance-by-Design Matters

A compliance-by-design model ensures that every process—from onboarding customers with KYC checks to securing transactions through PCI DSS encryption—is built to withstand scrutiny. Rather than reacting to regulatory audits or breaches, FinTech firms that adopt this approach create a scalable and resilient framework that supports customer trust and investor confidence.

Steps to Build Compliance into Your Startup

Gap Assessment

Begin with a full assessment of your systems against FCA regulations and PCI DSS 4.0 standards. This highlights vulnerabilities in areas like AML processes, data security, and operational resilience.

Hire a Compliance Officer

A Chief Compliance Officer (CCO) or equivalent role ensures accountability and provides a direct link to regulators like the FCA. This position becomes critical as your FinTech scales across multiple jurisdictions.

Automate with RegTech

Manual compliance processes are prone to error. Using RegTech tools such as ComplyAdvantage, Onfido, or Alloy helps streamline KYC/AML checks, fraud detection, and ongoing monitoring. The RegTech market is projected to reach $28.9 billion by 2025 (Statista, 2024), reflecting its growing role in compliance automation.

Staff Training

Your team must be equipped to recognize compliance risks. Regular training on FCA consumer duty rules, PCI DSS security standards, and AML obligations ensures employees actively contribute to a culture of compliance.

Regular Audits

Schedule quarterly internal reviews to test controls before regulators step in. With PCI DSS 4.0 requiring continuous risk assessment, audits are no longer optional—they are essential for staying audit-ready.

Final Note

By embedding FCA and PCI DSS compliance from the outset, FinTech startups can reduce regulatory risk, avoid costly fines, and build a foundation for sustainable growth. Compliance isn’t a barrier—it’s a competitive advantage.

FinTech companies often struggle to understand the overlap between FCA regulations and PCI DSS standards. While both are critical for compliance, they serve different purposes. The FCA governs financial conduct and consumer protection in the UK, while PCI DSS sets the global benchmark for payment card data security. Many FinTech startups must adhere to both, especially if they operate in the UK and handle card payments internationally.

Key Differences Between FCA and PCI DSS

The FCA focuses on transparency, AML/KYC obligations, consumer duty, and operational resilience, ensuring that financial services are fair and trustworthy. In contrast, PCI DSS compliance revolves around technical safeguards like multi-factor authentication, encryption, and continuous risk assessments to protect sensitive payment cardholder data.

With the release of PCI DSS 4.0 in March 2025, requirements became stricter, demanding real-time monitoring and stronger authentication protocols. At the same time, FCA enforcement has also increased, with fines surpassing £215 million in 2024 alone. This means FinTech firms must build compliance-by-design strategies to avoid penalties and protect customer trust.

Comparison Table

Why Both Matter for FinTechs

A UK-based FinTech scaling globally cannot choose between FCA and PCI DSS—it must comply with both frameworks. FCA compliance builds trust with regulators and customers, while PCI DSS safeguards transaction security across borders. Together, they form the backbone of a secure, scalable, and regulation-ready FinTech ecosystem.

Treating Compliance as a One-Off

• Fix: Implement continuous monitoring systems with automated alerts.

Relying Solely on Manual Processes

• Fix: Adopt RegTech solutions to reduce human error.

Underestimating Data Security

• Fix: Encrypt data at rest and in transit; use tokenization.

Weak Vendor Oversight

• Fix: Audit third-party partners; ensure they’re PCI DSS certified.

Ignoring Consumer Duty Requirements

• Fix: Design customer-first products and proactively address risks.

Lack of Incident Response Plan

• Fix: Maintain a tested playbook for data breaches or outages.

FinTech compliance isn’t just about theory—it’s visible in how leading firms respond to FCA regulations and PCI DSS standards. These examples highlight how companies successfully navigated compliance challenges while scaling globally.

Monzo’s Compliance Scaling Challenge

Monzo’s rapid growth in the UK put its compliance framework under immense pressure. By 2023, the digital bank faced increasing scrutiny from the Financial Conduct Authority (FCA), especially around anti-money laundering (AML) and Know Your Customer (KYC) processes. To stay ahead, Monzo invested in RegTech solutions, automated transaction monitoring, and real-time fraud detection. This approach not only satisfied FCA compliance requirements but also strengthened customer trust, enabling the bank to expand its international footprint without major regulatory roadblocks.

Square’s PCI DSS Model for SMEs

Square (now Block Inc.) provides a strong example of PCI DSS compliance by design. Instead of pushing the burden of compliance onto small businesses, Square embedded PCI DSS requirements directly into its payment processing ecosystem. This shielded SMEs from direct costs and risks, making Square a trusted partner for secure card transactions. With PCI DSS 4.0 changes in 2025 mandating stronger authentication and encryption, Square’s proactive model demonstrates how integrating compliance early can fuel customer adoption and loyalty.

Wise and Early FCA Licensing

TransferWise (Wise) took a compliance-first strategy by securing FCA licensing early in its journey. This gave the cross-border payments platform a regulatory advantage, allowing seamless expansion across more than 170 countries. By prioritizing compliance with capital adequacy rules, AML checks, and transparent reporting, Wise avoided the licensing delays faced by some competitors and positioned itself as a trusted global payments leader.

Starling Bank’s Operational Resilience

Starling Bank leaned heavily into FCA’s operational resilience standards. By deploying multi-cloud redundancy across AWS and Google Cloud, Starling ensured uninterrupted services even during the 2024 AWS outage. This move not only satisfied FCA requirements but also showcased how resilience and compliance directly impact customer experience, proving that robust compliance planning can be a competitive differentiator in FinTech.

This article draws from 2023–2025 reports, government publications, and industry research to provide accurate, up-to-date compliance insights.

Tools Used

• Regulatory Databases for FCA updates
• PCI DSS 4.0 Documentation from PCI SSC
• RegTech Platforms (ComplyAdvantage, Onfido) for industry practices

Data Sources

• Financial Conduct Authority (UK) annual reports (2024)
• PCI Security Standards Council (2025 update guides)
• Deloitte, PwC, McKinsey FinTech surveys (2023–2024)
• Statista global compliance market outlook (2024)

Process

• Collected recent regulatory updates from FCA and PCI SSC.
• Analyzed compliance breach reports and penalties issued in 2023–2025.
• Cross-verified with industry expert commentary.

Limitations & Verification

• FCA regulations are UK-specific; applicability outside varies.
• PCI DSS requirements evolve; version 4.0 details are new as of 2025.
• Verified through cross-referencing multiple authoritative reports.

Navigating FCA and PCI DSS compliance isn’t just about avoiding fines—it’s about proving to customers and investors that your FinTech is trustworthy, resilient, and future-ready. Build compliance into your DNA, automate where possible, and never underestimate the cost of neglect.

Ready to strengthen your compliance posture? Download our free FinTech healthtech beyond compliance profitability Checklist today.

• Financial Conduct Authority – “Annual Report 2024.” (2024)
• PCI Security Standards Council – “PCI DSS v4.0 Summary of Changes.” (2025)
• Statista – “RegTech Market Size Worldwide 2020–2025.” (2024)
• PwC – “FinTech State of Compliance 2023.” (2023)
• Deloitte – “Consumer Trust in Financial Services 2023.” (2023)