Whether you are a SaaS platform, marketplace, payroll provider, retail brand or vertical software company, the objective is usually clear: 

• Embed financial products into your platform 
• Improve customer retention and revenue 
• Avoid applying for a banking licence 
• Outsource regulatory complexity  

In the UK and Europe, three providers frequently appear on shortlists for this model: 

• ClearBank 
• Solaris 
• Modulr  

Each enables brands to add financial functionality without holding their own banking licence. However, their regulatory structures and strengths differ.

When brands say they do not want to become a bank, they usually want to avoid: 

• Applying for a banking licence 
• Meeting capital and liquidity requirements 
• Managing direct payment scheme participation 
• Building safeguarding or deposit infrastructure 

Instead, they want a regulated partner that: 

• Holds the licence 
• Provides access to payment rails 
• Manages safeguarding or deposit responsibility 
• Offers API-driven integration  

This is commonly referred to as: 

• Embedded banking 
• Banking as a Service (BaaS) 
• Bank sponsorship 
• EMI infrastructure 

The key is understanding which regulatory model sits underneath.

Partnering with a licenced bank or EMI does not remove regulatory exposure entirely. It redistributes it. 

While the regulated entity holds the formal permissions, brands distributing financial products need to demonstrate appropriate oversight of numerous aspects, including customer onboarding and journeys, disclosures and complaints handling. 

As volumes scale, scrutiny tends to follow the customer experience, not just the licence holder. 

Avoiding a banking licence reduces prudential burden. It does not eliminate governance expectations. 

When shortlisting providers, the question is not only who holds the licence, but how regulatory responsibility will evolve as your embedded finance proposition grows. 

ClearBank is a UK-based clearing bank, authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority. 

Unlike many embedded finance providers, ClearBank is itself a fully licenced bank. That distinction fundamentally affects: 

• How customers’ funds are protected 
• How payment scheme access is delivered 
• Where regulatory responsibilities sit and to what extent 

Because ClearBank is a bank – not an EMI – it can offer FSCS-protection on eligible deposits, real, named accounts, and direct scheme connectivity through a single API. 

With ClearBank, you can: 

You can integrate with ClearBank’s API to gain indirect access to UK payment schemes (FPS and CHAPS) without needing to become direct scheme members. 

How it works: 

• You remain responsible for your customer experience, onboarding and ongoing compliance controls 
• ClearBank maintains scheme membership, settlement accounts and operational resilience 
• ClearBank ensures adherence to scheme rules and regulatory standards 
• You benefit from real-time, bank-grade payment rails through a single integration 

Benefits 

• Faster go-to-market compared with pursuing direct scheme membership 
• No need to build or maintain scheme attestations, testing, certification, and operational processes 
• Lower cost and operational complexity 
• Access to UK and EU payment rails via a single regulated partner 

Under ClearBank’s embedded banking model, in the UK, your brand can also offer real, interest-bearing accounts and FSCS protection without having to become a bank yourself.  

How it works: 

• Your brand owns the user experience, distribution and customer relationship 
• ClearBank provides regulatory oversight and ensures compliance within defined guardrails 

This model bridges the gap between: 

• Partnering with an EMI, that cannot offer FSCS protection or interest-bearing deposits 
• Applying for your own banking licence, which is costly, slow and operationally intensive 

Embedded banking is particularly relevant for organisations planning to offer: 

• FSCS-eligible savings accounts (for example, Wealthify, the digital wealth platform, uses ClearBank to power its instant-access savings account) 
• Payroll-linked accounts and embedded savings (PayCaptain uses ClearBank to embed FSCS-eligible savings accounts directly within its payroll app) 
• Platform or marketplace accounts holding customer balances (for instance, property platforms holding tenancy deposits) 

Solaris SE is a CRR-licenced German bank operating as an embedded finance platform across the EU. Through its APIs, brands can embed regulated banking services – accounts, cards, payments, and lending – without becoming a bank themselves.

• Euro accounts with local or virtual IBANs (DE, FR, ES, IT) 
• Checking, savings, multi-accounts and sub-accounts 
• SEPA, SEPA Instant and Direct Debit 
• Debit, prepaid and credit card issuing 
• Digital onboarding (KYC/KYB) 
• Overdrafts, instalments and consumer lending 

Solaris also provides real-time notifications, open banking integrations, and loyalty features to enhance customer journeys. 

Typical use cases include neobanks, fintech apps, SME platforms, and consumer brands that embed accounts, payments, or credit into their products. 

As a fully licenced bank, Solaris offers deposit protection up to €100,000, operates across the EEA via passporting, and handles all prudential and compliance obligations, while partners can retain control of UX. 

Modulr is a UK- and EU-licenced Electronic Money Institution. It focuses primarily on embedded payments rather than deposit-taking. 

As an EMI, Modulr safeguards customer funds in accordance with UK and EEA regulations. Safeguarding is not the same as FSCS deposit protection. 

• E-money accounts with sort codes and IBANs 
• Automated pay-ins and pay-outs 
• Card issuing 
• Multi-currency support 
• Fraud and risk management tools 

Modulr is particularly strong in B2B and workflow-driven environments.

• Payroll automation 
• Travel payments 
• Accounting software 
• Lending platforms 
• Marketplace payouts 

For brands whose core requirement is high-volume payment automation rather than savings or deposit functionality, Modulr offers a focused and mature solution. 

• ClearBank: Fully licenced bank 
• Solaris SE: Fully licenced German bank (CRR) 
• Modulr: Licenced EMI 

• ClearBank: Can support FSCS-eligible deposit structures 
• Solaris: Can hold deposits with protection up to €100,000 under the German Deposit Guarantee Scheme 
• Modulr: Safeguarding only, no deposit guarantee scheme 

When shortlisting providers, look beyond API documentation. Three structural factors determine long-term success. 

Ask: 

• Is the embedded finance provider a licenced bank, or an EMI? 
• Who is responsible for KYC and AML? To which degree? 
• Who reports to the regulatory authorities? 
• If FSCS protection is part of the model, who compiles and manages deposit protection requirements? 
• Who holds customer funds, and where? 

If your provider relies on third-party sponsor banks (as is often the case with EMIs), assess: 

• Regulatory standing 
• Operational resilience 
• Concentration risk 

Sponsor exits can disrupt programmes. 

Understand: 

• Interchange splits 
• Account fees 
• FX margins 
• Shared interest models 

Unit economics should align with your long-term strategy. 

Sources: 

• https://www.solarisgroup.com/en/  
• https://www.solarisgroup.com/en/services/digital-banking/  
• https://www.solarisgroup.com/en/services/accounts/  
• https://www.modulrfinance.com/# 
• https://www.modulrfinance.com/why-us 
• https://www.modulrfinance.com/product/account-services