London fintech Railsr in emergency sales talks as FCA monitors health
The Financial Conduct Authority is understood to be keeping a close eye over the health of Railsr as it enters talks to complete an emergency sale.
The London-based payments fintech, formerly known as RailsBank, is seeking to be sold through a solvent transaction, according to Sky News, but could also face entering administration if talks break down.
Railsr has been a provider to Wagestream, a financial wellbeing app which is offered through hundreds of caring employers including Bupa, Burger King, Co-op, Pizza Hut, Next, Greene King and many NHS Trusts.
A spokesperson for the Wagestream said it wasn’t reliant on Railsr to provide its services and there would be no impact on any workers using its app.
Railsr said it was “still hopeful” a deal could be achieved. The business has been facing cashflow issues in recent months and faces allegations that its most recent $46 million funding round came in lower than originally reported, according to fintech news site Altfi.
In 2020, the firm acquired the UK assets of now defunct Munich-based payments business Wirecard, which collapsed in dramatic form after the company fessed up that almost €2 billion was missing from its accounts.
Annual accounts for Railsr have not been filed by Companies House and are now overdue by over two months, meaning the company is set to face fines.
A Railsr spokesperson said: “That’s correct.”
Headcount at the firm has been cut by almost 28% since April last year to 310 employees, LinkedIn data shows. Last year, the business was in takeover talks with Flutterwave, the African payments technology business, before a potential deal was abandoned.
A Railsr spokesperson said: “We are in ongoing discussions with interested parties as part of the M&A process. We are still hopeful that we can achieve an M&A event.”
The FCA said it does not comment on individual firms.