Payments infrastructure provider Modulr has joined the first Financial Conduct Authority Scale-up Unit cohort for businesses regulated solely by the FCA, entering a programme that pairs closer regulatory access with scrutiny of whether internal controls keep pace as technology companies grow.

ClearScore, Teya, Urban Jungle, and Zilch complete the five-company cohort, covering payments, consumer finance, credit information, and insurance technology. The FCA had already admitted a separate group of businesses jointly regulated with the Prudential Regulation Authority earlier this year.

Participants receive tailored support and a dedicated regulatory contact while developing products, responding to policy changes, and managing expansion. The arrangement also gives the FCA a closer view of the point at which governance, staffing, financial resilience, risk management, and technology controls begin to strain under faster growth.

Modulr enters the programme at substantial operating scale. The company says it processes more than 200 million transactions and over £180 billion in payment value on an annualised basis for more than 6,000 businesses, reached profitability in 2025, and has been expanding internationally, including into the US.

Growth support comes with a control test

The Scale-up Unit extends the FCA’s attempt to create a more continuous route between startup support and ordinary supervision. It sits alongside Innovation Pathways, pre-application assistance, and the Early and High Growth Oversight function, giving businesses another point of contact once they have moved beyond initial authorisation but remain in a period of rapid change.

That approach arrives amid pressure for UK regulators to support competitiveness and economic growth without weakening consumer or market protections. Financial technology makes the trade-off particularly visible because software can increase transaction volumes, product reach, and customer numbers much faster than the physical operating models that historically constrained financial institutions.

An FCA review of 15 high-growth businesses between July 2025 and March 2026 shows where that pressure tends to appear. The regulator examined governance, risk management, staffing, systems, controls, and financial resilience, identifying stronger practices where board structures, management information, compliance resources, and forward planning had matured alongside the business.

Weaker examples included governance concentrated around too few people, incomplete records, outdated management information, poor succession planning, and risk frameworks that had failed to change as products and customer populations expanded. The pattern is familiar outside finance, although regulated businesses face a harder consequence when internal immaturity begins to affect customer money or market integrity.

Technology can scale faster than governance

The FCA’s findings are particularly relevant to payments and other software-led financial services because transaction volume can rise without a comparable increase in employees. Automation, APIs, and cloud infrastructure allow a platform to add customers and process more activity quickly, while the operational impact of a defect can spread across a much larger base at the same speed.

Technology controls therefore become regulatory controls. The FCA’s work with high-growth businesses has examined cyber resilience, third-party oversight, transaction monitoring, data governance, operational resilience, and governance around emerging technologies such as AI, alongside more conventional financial and conduct risks.

Modulr’s position inside other businesses makes that relationship especially visible. Its platform supports payroll, supplier payments, collections, spend management, and other finance operations, so interruptions or control failures can propagate into customers’ own processes rather than remaining confined to one consumer application.

The company is also operating across a more interconnected payments environment as it expands geographically and participates in newer payment mechanisms. Each addition introduces dependencies around schemes, partners, regulators, suppliers, and internal technology, increasing the amount of governance required even where the underlying payment engine continues to perform reliably.

Supervision begins earlier

The Scale-up Unit does not remove the regulatory requirements applying to participating businesses, and acceptance should not be read as an endorsement of their products or controls. Its practical difference lies in providing more continuous contact while those businesses are changing quickly, rather than waiting for a supervisory problem to become formal before engagement intensifies.

The FCA says its wider innovation services have supported more than 1,000 businesses, but a scale-up programme addresses a different stage of development from helping an early startup navigate authorisation. Growth brings larger transaction volumes, additional products, international expansion, outsourcing, more employees, and more complex technology at roughly the same time.

Dedicated regulatory access could reduce uncertainty and allow control problems to be identified earlier, although the programme will eventually need to show that participants emerge with stronger governance rather than simply receiving a smoother relationship with the regulator.

For Modulr and the other four companies, the FCA is testing whether supervision can become more responsive without becoming more permissive. The businesses receive closer support while they expand, but the accompanying expectation is that governance, cyber resilience, risk management, and operating controls mature at least as quickly as the platforms carrying their growth.