UK payments and e-money firms still adapting to the new safeguarding regime face tougher audit requirements and increased scrutiny of systems and controls.
The new safeguarding regime for UK payments and e-money firms came into effect in May 2026.
This marked the end of a long consultation process, culminating in a major shift in regulatory requirements for the payments sector – so if your firm is still adjusting, don’t be embarrassed about seeking guidance.
The background
The new Interim Rules around safeguarding client money, also known as the Supplementary Regime, were published by the Financial Conduct Authority (FCA) in August 2025.
They add key requirements to the FCA’s CASS (Client Assets Sourcebook): CASS 15 and CASS 10A, as well as new rules and guidance in the FCA’s supervision manual (SUP).
This followed a two-year consultation period with particularly high levels of industry engagement and speculation about the shape the new rules would ultimately take. This means many firms could be forgiven for feeling safeguarding fatigue by the time the Interim Rules were finally announced.
On top of that, firms were given just nine months to comply before the new rules came into effect on 7 May 2026. If you have felt overwhelmed by these changes to the safeguarding requirements, you may still be behind on your preparations for the new Interim Rules.
If you recognise that you’re in this position, now is the time to seek specialist advice.
Safeguarding audits
One important area of change relates the safeguarding audit obligations. In a move designed to improve the integrity and credibility of the overall safeguarding audit process, more firms are now required to have audits of their safeguarding arrangements, and those audits can now be performed only by statutory auditors.
Even if your firm was previously confident under the legacy rules, you may now feel exposed to a level of scrutiny you are neither used to nor comfortable with.
Perhaps this has translated into a sense of embarrassment about your current state of readiness, causing you to delay engaging with or appointing an auditor.
An opportunity to seek support
There’s no need to be embarrassed about recognising that there may still be work to do.
The new safeguarding rules are a big ask for the payments sector. Even the Financial Reporting Council (FRC) acknowledge in their guidance that ‘the transition to the Supplementary Regime may present complexity for firms [which] stems from overlapping legacy rules and new expectations from regulators and stakeholders.’
Put another way: if you’re finding this difficult, you’re certainly not alone.
The good news is that you don’t need to face this challenge on your own. Instead of shying away from the safeguarding audit process, this is a perfect opportunity to seek expert support with identifying and addressing any gaps or weaknesses in your safeguarding systems and controls.
How BKL can help
Our specialists in financial services regulations combine top-tier safeguarding audit experience with specialist safeguarding advisory expertise.
This dual capability means your safeguarding audit becomes a truly value-adding exercise that provides clarity, insight and a practical roadmap for achieving and maintaining the highest levels of compliance with the new rules.
We can also support you with navigating safeguarding audits conducted by other providers. From performing pre-audit gap analysis and targeted remediation exercises to preparing your audit pack and helping you engage constructively with your auditor, we can help make the audit process more efficient and more effective for all parties.
Safeguarding under the supplementary regime is demanding, but it needn’t be embarrassing. With the right support, you will benefit from stronger governance, better controls and greater confidence in your regulatory compliance.
For a chat about how we can help you, get in touch with Ben using the form below.
You can also find a range of insights, videos and practical tips on our CASS 15 Hub.
