London-based fintech firm Guavapay is facing a potential liquidation as Mastercard has issued a winding-up petition over unpaid debts, City AM reports. The petition, filed on Christmas Eve, threatens the jobs of over 500 employees who manage cross-border money transfers for individuals and businesses.
A hearing at the High Court is scheduled for January 21st, where Guavapay will need to demonstrate a plan to settle its debts to Mastercard or face being forced into liquidation. Neither Guavapay nor Mastercard have publicly commented on the matter.
FCA Intervention and Recent Challenges
This legal action follows a period of difficulty for Guavapay, which in September suspended onboarding new customers and accepting new funds due to “concerns” raised by the Financial Conduct Authority (FCA) regarding customer due diligence and fraud prevention. Following the FCA’s intervention, three directors resigned from the firm’s board.
While Guavapay stated the FCA’s concerns were intended to be addressed temporarily, the firm reported in November it lacked clarity on when restrictions would be lifted. The company’s founders also own a separate crypto trading business, Finbloom.
Despite these challenges, Guavapay reported a significant increase in turnover in 2024, reaching £23.4m – nearly double the previous year’s figure – and posting a pre-tax profit of just under £2m. The firm expanded internationally in late 2024, opening a subsidiary in Azerbaijan with an e-money license, and made a symbolic gesture in December by gifting a rug to a City of London policy chief.
Leadership changes have also marked the past year, with the appointment and subsequent departure of fintech veteran Guy Noble as chief executive in March. In August, co-founder Elkhan Nasibov was appointed chair of the skills committee of the London Chamber of Commerce.
Frequently Asked Questions
What is a winding-up petition?
A winding-up petition is a legal process that, if successful, results in a company being liquidated – its assets sold off to pay creditors.
When is the court hearing scheduled?
The High Court hearing regarding the winding-up petition is scheduled for January 21st.
What were the FCA’s concerns regarding Guavapay?
The FCA expressed “concerns” regarding Guavapay’s customer due diligence and fraud prevention measures, leading the firm to suspend onboarding new customers.
Given the current situation, what steps do you think Guavapay will need to take to resolve this crisis and secure its future?
