Transaction trends are evolving across Europe. Historically, industry norms were controlled by several dominant legacy acquirers who rendered systems costly, inflexible and, essentially, biased against anyone seeking innovation. However, the momentum is shifting. Bold PayFacs and fintech firms are no longer willing to follow outdated standards. They demand quicker launch timelines, deeper mastery of their client connections and the capacity to capture fresh profit channels under their own conditions.
Throughout North America, Asia and the Gulf, this transition is already surging as PayFacs and fellow startups leverage acquiring BIN sponsorship. Europe, conversely, has stalled – hampered by legal intricacies and the prevalence of established giants. This environment is transforming, and it is occurring rapidly. The puzzle remains: which players are prepared to capitalise?
The UK opportunity
The UK is a £2.56tn payments market – one of the most attractive in the world for international expansion. But the path in isn’t straightforward. The FCA is one of the most rigorous regulators in global finance, and integrating into the existing ecosystem is no easy feat. Debit cards account for 51% of payments, contactless makes up 38%, and cash still clings to 12%. The opportunity for innovation is huge, but so are the barriers. The old model assumes that ambitious PayFacs and fintechs will accept prescriptive rules and long onboarding times in exchange for scheme access. That’s not good enough anymore. Acquiring BIN sponsorship has emerged as the smarter alternative. By enabling fintechs to operate as something akin to an acquirer by piggybacking on an existing acquirer’s licences, ambitious companies can get rid of regulatory roadblocks and unlock faster growth, more affordability, and payments that they are in control of.
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What is BIN sponsorship?
A BIN – Bank Identification Number – is the series of digits that identifies the acquiring or issuing institution behind a card transaction. Owning one is the gateway to playing in the big leagues of payments. But getting there requires direct scheme membership, regulatory approvals, compliance investment, and infrastructure build – a process that can swallow years and millions in capital.
BIN sponsorship tears down that barrier. By operating under a licensed acquirer’s BIN and regulatory umbrella, PayFacs and other fintechs can act as acquirers without the bureaucratic nightmare. Existing acquirers outside of the UK and European market have the opportunity to enter the market without the significant time, cost and complexity that comes with getting scheme and regulatory licenses. The sponsor handles compliance and scheme membership while the partner controls onboarding, pricing, processing, settlement, and merchant experience.
For PayFacs and fintechs looking to scale, this isn’t just an option – it’s the difference between being a bystander and being in the driver’s seat.
Breaking away from the old guard
The newer, more progressive generation of acquirers have built global reputations by providing scale and reliability. But their models come with strings attached. Partners operate on their terms alone. Pricing is fixed, onboarding flows are templated, and the freedom to innovate is limited. For businesses that want flexibility and differentiation, the experience is often more restrictive than empowering.
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By GlobalDataThis is where we need to challenge the status quo. With acquiring BIN sponsorship, we’re enabling PayFacs and fintechs entering the UK and European market to flip the script. Instead of being told how to run their payments, they’re given the infrastructure and regulatory backing to own the journey themselves.
The message is simple: stop waiting in line. Stop letting acquirers dictate your strategy. Seize the Power.
The rise of payment aggregators – and their ceiling
The rise of PayFacs shows just how much pent-up demand exists in the market. Aggregators proved there was a better way – faster onboarding, customisable pricing, and stronger merchant experiences. But PayFacs still rely on the underlying acquiring infrastructure. Without direct scheme membership or sponsorship, they eventually hit a ceiling.
That’s why BIN sponsorship is such a critical next step. It breaks through that ceiling, giving PayFacs and fintechs the ability to operate as acquirers without the scheme and regulatory burden. It’s not just evolution, it’s revolution.
A case in point: Mswipe
A prime example of modern market entry is India’s Mswipe, a prominent merchant payment solution provider that recently expanded into the UK. Rather than embarking on the arduous journey of applying for a domestic acquiring licence – a process that can often stall operations for years due to regulatory hurdles – Mswipe utilised a BIN sponsorship model. By leveraging existing infrastructure, they were able to bypass the typical waiting period and launch their UK operations almost immediately.
This strategic partnership allowed Mswipe to maintain full control over merchant onboarding, settlement timelines and localised pricing strategies, all while operating securely under an established acquiring licence and BIN. This enabled the company to focus its energy on customer growth and product refinement rather than being bogged down by the administrative demands of a new region.
The shift toward BIN sponsorship is driven largely by the massive reduction in time and cost to market. Gaining direct membership with major card schemes like Visa and Mastercard is a capital-intensive endeavour that requires significant technical and financial investment. Sponsorship effectively bypasses these barriers, providing fintechs with near-instant access to vital acquiring capabilities.
This model also significantly simplifies regulatory compliance. Navigating the complexities of the Financial Conduct Authority (FCA) and staying abreast of Anti-Money Laundering (AML) and Know-Your-Customer (KYC) obligations is a heavy lift for any newcomer. Under a sponsorship arrangement, the sponsor manages these burdens, ensuring strict adherence to the law while allowing the sponsored entity to remain agile.
Beyond compliance and speed, greater control over merchant relationships is on the cards for businesses, allowing them to customise how they engage with their clients. Even though the sponsor technically owns the BIN, the sponsored entity retains the power to differentiate itself through tailored pricing models, onboarding flows and service terms. This flexibility is crucial for accelerated market testing. Because the entry is less capital-intensive, fintechs can launch and iterate their offerings in real-time. This “test and learn” approach is invaluable for assessing product-market fit and refining a go-to-market strategy before committing to the long-term goal of full, independent scheme membership.
Why does this matter?
For current PayFacs, this leads toward being full acquirers – managing the merchant lifecycle start-to-finish. The true point of distinction involves partnership, not imposing the terms but cooperating, co-designing and dividing the risk and return. The UK payments sector continues being one of the most evolved, profitable and aggressive environments on earth. Yet the standard acquiring method barely suits the visions fintechs and PayFacs wanting to expand quickly and hold their income levels.
Acquiring BIN sponsorship provides an option – a better, swifter and more agile path to enter and grow. Clients won’t just buy access to software and connectivity – they gain a teammate with background and knowledge who is actually in their corner. The age of staying months for consent, just to be limited by another’s rules, has passed. It is time for payment pioneers to seize command and claim the lead.
Philip Harding is Commercial Director at Cashflows
