About This Template
Every FCA-authorised Electronic Money Institution (EMI) and Payment Institution (PI) must hold minimum regulatory capital at all times. The FCA's approach under the Electronic Money Regulations 2011 and the Payment Services Regulations 2017 requires firms to calculate their capital requirement under three separate methods and hold the highest of the three. In practice, most CFOs at smaller firms manage this in a spreadsheet — but few have a single, well-structured workbook that combines the capital calculation, the compliance calendar, and the risk register in one place.
This template provides exactly that. It is designed for the finance and compliance teams at FCA-authorised EMIs and PIs, from early-stage e-money startups to established payment businesses scaling their volumes. It is not a substitute for legal or regulatory advice, and you should always sense-check your capital calculation with your legal advisers or the FCA's own published guidance. But it gives you the structured framework to perform and document that calculation consistently.
The template covers the full lifecycle of regulatory capital management: calculating the requirement, monitoring headroom against your own funds, tracking your compliance filing calendar, and maintaining a regulatory risk register that your board and auditors can review.
What's Included
The workbook contains four sheets, each serving a distinct purpose:
Sheet 1 — Instructions
An overview of FCA capital requirements for EMIs and Payment Institutions. Covers the three calculation methods, the regulatory reporting calendar obligations, and guidance on how to use each sheet in the workbook. Designed to be shared with new finance team members or external auditors to give them context before they work through the calculations.
Sheet 2 — Capital Requirements
The core calculation sheet. Enter your institution type (EMI or PI) and the relevant financial inputs, and the sheet calculates your required capital under all three methods automatically:
- Method A (Fixed Overhead Requirement): One quarter of your fixed overheads for the preceding year, multiplied by 10%. Enter your annual fixed overheads and the formula does the rest.
- Method B (Variable Requirement): A tiered calculation based on monthly payment volumes, applying the relevant percentage to each volume tier. Enter your monthly volumes by tier and the blended rate is calculated automatically.
- Method C (Base Capital): A fixed amount determined by your institution type — the sheet looks this up automatically based on the EMI/PI selection at the top.
- Required Capital: The MAX of A, B and C, clearly displayed.
- Own Funds and Headroom: Enter your current own funds and the sheet calculates headroom and displays a RAG status — Green (headroom ≥20%), Amber (10–20%), Red (<10%).
Sheet 3 — Compliance Calendar
A structured calendar of all regulatory filings and notifications required for FCA-authorised firms. Pre-populated with the standard returns including REP-CORA (quarterly capital adequacy return), annual report filings with Companies House, confirmation statement, statutory accounts, capital breach notifications, material change notifications, wind-down plan reviews, ICAAP/ICARA, and PSD reporting. Each row includes the return name, regulator, due date, frequency, responsible owner, status (RAG), and a notes column.
Sheet 4 — Risk Register
A regulatory risk register pre-populated with six key regulatory risks: capital breach, safeguarding failure, AML non-compliance, late regulatory filing, carrying on unauthorised business, data breach. Each risk has a Risk ID, category, likelihood, impact, combined score, control description, owner, and review date. The register is designed to be maintained quarterly and presented to the board as evidence of ongoing regulatory oversight.
How to Use This Template
- Set your institution type. On the Capital Requirements sheet, select EMI or PI from the dropdown at the top. This determines the Method C base capital amount and sets context for the rest of the workbook.
- Enter your financial data for Method A. Input your annual fixed overheads (excluding variable costs, exceptional items, and shared costs not directly attributable to the payment services business). The Method A requirement is calculated automatically.
- Enter your monthly payment volumes for Method B. Input your average monthly payment transaction volume broken down by tier. The tiered calculation applies the correct percentage to each band and sums them to give your Method B requirement.
- Review the required capital figure. The MAX(A,B,C) row shows your regulatory minimum. Compare this to your current own funds and review the RAG status.
- Update the Compliance Calendar at the start of each quarter. Mark completed filings, update due dates for the coming quarter, and assign or confirm owners for upcoming returns. Use the Notes column to record reference numbers for submitted returns.
- Review the Risk Register at each board meeting. Update likelihood and impact scores, record any new controls implemented, and confirm review dates. The board should formally approve the risk register at least annually.
Frequently Asked Questions
What happens if I breach my minimum regulatory capital requirement?
You are required to notify the FCA immediately if you breach or expect to breach your minimum capital requirement. The notification should include the nature and scale of the breach, the cause, the current and projected own funds position, and the remediation plan. Failure to notify promptly is itself a regulatory breach. The FCA may impose supervisory measures including requiring you to hold additional capital or restricting your activities.
How often should I review my own funds calculation?
At a minimum, own funds should be calculated monthly using management accounts, with a formal reconciliation at each quarter-end for the REP-CORA submission. If your business is growing rapidly — and therefore Method B volumes are increasing — you should model the projected capital requirement on a forward-looking basis at least monthly so you have adequate warning if headroom is declining.
What is the difference between Method A, Method B and Method C?
Method A (Fixed Overhead Requirement) is based on your cost base — it applies a percentage to your fixed overheads. It is the most relevant method for firms with a high cost base relative to their payment volumes. Method B (Variable/Scaled Requirement) is based on your payment transaction volumes, applying tiered percentages to different volume bands. It is the most relevant method for high-volume, lower-cost businesses. Method C (Base Capital) is a fixed floor that all firms must hold regardless of their size or volumes — it is the absolute minimum. You must hold the highest of all three.
Do I need to file REP-CORA if I have no regulated payment activity in a quarter?
Yes. The REP-CORA is required regardless of whether you have had any payment activity. You must still submit the return showing your own funds, calculate your capital requirement (which will be Method C at minimum), and confirm compliance. If you are a dormant regulated entity, you should speak to the FCA about your regulatory obligations, as there may be grounds to vary your permission or cancel your authorisation if you have no foreseeable regulated activity.
What counts as "own funds" for the purposes of the capital requirement?
Own funds for EMIs and PIs broadly correspond to Tier 1 capital under the Capital Requirements Regulation — primarily paid-up share capital, share premium, retained earnings, and other reserves, less deductions for intangible assets, goodwill, and certain other items. The precise definition is set out in the applicable regulations and the FCA Handbook. Your external auditors or legal advisers should confirm the composition of your own funds for regulatory capital purposes.
Is this template suitable for firms that are both authorised as an EMI and hold a variation of permission?
The template covers the standard capital calculation framework applicable to EMIs and PIs. Firms with additional permissions, hybrid business models, or activities subject to separate capital requirements (such as investment firm requirements under MIFIDPRU) may have additional capital obligations that are not captured here. In those cases, the template should be used as a starting point and supplemented with advice from your regulatory counsel.
