New Kani research reveals a significant gap between perceived compliance and operational reality as the regime takes effect
Nearly 90% of UK payments firms are not yet compliant with the FCA’s updated safeguarding rules, despite widespread confidence that they are, according to new research from Kani Payments, the award-winning payments reconciliation and reporting platform.
The study, which surveyed 75 compliance and finance leaders across FCA-regulated payment institutions and electronic money institutions, found that while 32% believe they are already compliant with updated CASS 15 requirements, just 13% are performing the daily reconciliations those rules demand.
With the regime coming into force on 7 May 2026, the findings reveal a significant gap between how ready firms feel and how ready they actually are.
Confidence outpacing capability
Awareness of the new rules is high. No respondents reported uncertainty about how the requirements apply to their organisation, and 84% say they could explain their safeguarding calculations to an auditor if required.
The underlying processes tell a different story. Without daily reconciliation, shortfalls can go undetected for extended periods, while root-cause analysis and evidence gathering become significantly more complex under regulatory scrutiny.
The FCA’s 48-hour expectation for producing safeguarding resolution packs adds further pressure. Only 36% of firms report having instant or near-instant access to a complete evidence pack. Among those relying solely on spreadsheets, two-thirds require at least six hours to compile the necessary data, and one in three needs more than a full working day.
Spreadsheets creating structural risk
Despite increasing regulatory expectations, spreadsheets remain central to many firms’ safeguarding processes. Nearly two-thirds (64%) still rely on them for monthly safeguarding returns.
While spreadsheet-based processes are not inherently non-compliant, they introduce structural vulnerabilities at a time when regulators are demanding greater control, transparency and auditability. Among firms using spreadsheets alone, 22% say they lack confidence that their reports would withstand audit scrutiny.
Aaron Holmes, CEO of Kani Payments, said: “This is a clear case of confidence outpacing capability. Firms understand the rules, but many are not yet operating in a way that meets them.
“When only one in eight firms is reconciling daily, but daily reconciliation is now the standard, that is not a marginal gap—it is a structural issue. Treating this as a reporting upgrade misses the point. This is an operational shift. Firms need to move from periodic processes to continuous control.”
A fundamental operational shift
The updated regime, introduced under PS25/12, represents a fundamental change to how safeguarding must function. It shifts from a periodic compliance obligation to a continuous operational control, with daily reconciliation, enhanced record-keeping and formalised evidence standards embedded in regulatory expectation.
For firms whose back-office processes were designed around weekly or monthly cycles, this transition requires more than increasing the frequency of existing tasks. Reconciliation logic, data ingestion, exception management and reporting must be restructured to operate consistently and reliably every day.
Holmes added: “You cannot simply accelerate a weekly process and expect it to meet daily requirements. Firms need systems and controls that are built for consistency, not manual assembly.
“The deadline is here, and the FCA has been clear about its expectations. Firms that have not adapted risk falling behind very quickly.”
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Kani helps payment institutions and EMIs automate safeguarding reconciliation, maintain audit-ready evidence and meet the FCA’s daily expectation.
