Banking Circle nabs first banking licence from Luxembourg regulators

Written by Ruby Hinchliffe
27th February 2020

Banking Circle, the firm which helps facilitate cross-boarder payments between businesses, has secured its first banking licence from a Luxembourg regulator.

Issued by the Commission de Surveillance du Secteur Financier (CSSF), the licence will see the operational centers Banking Circle holds in the UK, Germany and Denmark turned into bank branches. Meanwhile, Luxembourg will become home to its pan-European headquarters.

“Given Luxembourg’s role as a leading financial centre in Europe and a hub for payment services, it made complete sense for Banking Circle […] to choose Luxembourg as its headquarters, ” says the country’s finance minister Pierre Gramegna, who highlights the boost in “security and compliance rigour” a banking licence will equip the firm with.

Now Banking Circle, founded in 2015, can extend into new geographies too

Already processing a €130 billion run-rate on annual payment volumes, Banking Circle has – until now – made all its money by using direct clearing access through blue-chip bank partners to power the payments market. Now, the company will extend its infrastructure further by underpinning payments firms’ banking services.

“In the last four years we have built a financial infrastructure that numerous payments businesses have adopted to process their cross border payments. We have also tackled the limited access to funds for SMEs with our lending solutions,” says co-founder and CEO Anders la Cour.

“Securing our banking licence gives us the ability to deliver bank accounts on a global scale so that we can extend our propositions, enabling payments businesses, such as payment service providers [PSPs] and acquirers, to offer banking services to their clients without having to invest in their own costly infrastructure,” la Cour adds, calling the European banking licence “an inevitable goal” for the firm.

Now Banking Circle, founded in 2015, can extend into new geographies too, as just one European banking licence gives companies – similarly like Revolut and its Bank of Lithuania licence – the power to expand over the whole continent.