Breaking: Zilch Expands Across Europe With Fjord bank Takeover, Secures Cross‑Border Licences
Table of Contents
- 1. Breaking: Zilch Expands Across Europe With Fjord bank Takeover, Secures Cross‑Border Licences
- 2. Zilch On The Road To A Public Debut
- 3. Zilch’s market position in the UK BNPL sector (2025‑2026)
- 4. Recent funding rounds and valuation trajectory
- 5. Deal‑making strategy: targets and rationale
- 6. Notable partnerships driving the deal‑spree
- 7. Regulatory landscape and FCA compliance checklist
- 8. IPO timeline and listing prospects
- 9. Investor considerations and valuation metrics
- 10. Practical tips for stakeholders
- 11. Real‑world example: Zilch’s partnership with ClearScore (2024)
- 12. Fast‑reference checklist for the “Deal‑Spree” phase
In a move set to accelerate it’s European ambitions, UK consumer payments group Zilch has agreed to acquire Fjord Bank, a Lithuanian challenger bank. Teh deal grants Zilch a European banking license pathway and positions the fintech for faster expansion beyond its core payments business.
CEO Philip Belamant said the acquisition provides a regulatory umbrella to move quickly across Europe while bringing an experienced team on board. He stressed the transaction is not a pivot into full banking, but a strategic step to enable broader growth in payments and related services.
The deal follows a late‑2025 financing round that raised US$175 million in debt and equity, led by KKCG, with a significant portion earmarked for strategic M&A. Belamant indicated there is still capital left from that round to support further growth.
Zilch On The Road To A Public Debut
Under a European banking licence, Fjord can act as a passport into multiple EU markets, complementing Zilch’s existing UK footprint.Zilch already operates in the UK with two FCA authorisations for payments, following a December 2025 milestones‑level step securing a payments licence.
Belamant noted there are tangible benefits to maintaining and expanding UK operations alongside the European expansion, emphasizing that the Fjord deal is primarily about speeding growth in consumer payments rather than building a customary bank.
In terms of performance, Fjord Bank reported a €1.16 million profit in the first nine months of 2025, reversing a €218,000 loss for the same period in 2024.The group holds about €120 million in assets regulated by the European Central Bank, underscoring Fjord’s scale as a regional platform.
Analysts view the acquisition as a strategic passporting vehicle for Zilch to accelerate its cross‑border payments strategy across continental Europe, while enabling faster time‑to‑market in new jurisdictions.
Belamant said the company would “certainly consider all options for funding and growth” as it progresses toward a potential public listing in London, a topic he has previously described as “fantastic.”
Industry context remains mixed on licensing approvals in the UK. Observers note that only a handful of e‑money licences were approved in early 2025 despite dozens of applications, highlighting a careful regulatory environment. revolut, for instance, has faced scrutiny around its banking licence timeline.
Belamant stressed ongoing engagement with regulators, saying zilch is actively working with the authorities and continuing discussions as it expands its regulatory footprint in Europe.
The Fjord Bank acquisition is expected to support Zilch’s European consumer‑payments push and help it accelerate plans to operate across multiple EU markets in coming years.
| Category | Details |
|---|---|
| Deal participants | Zilch (UK fintech) acquiring Fjord Bank (Lithuania) |
| purpose | Create regulatory umbrella for fast European expansion; not a banking pivot |
| funding round | US$175 million in debt & equity, led by KKCG, closed late 2025 |
| Fjord profitability (9M 2025) | €1.16 million profit; €218k loss in 2024 (comparative) |
| Fjord assets | About €120 million in assets regulated by the European Central Bank |
| Licensing status | Two UK FCA authorisations; payments licence obtained in December 2025 |
| Strategic outcome | Passporting into EU markets; accelerate cross‑border payments strategy |
| Growth outlook | Possible further fundraising; potential London listing remains under consideration |
External context: regulators in Europe continue to balance innovation with oversight, and cross‑border licensing regimes are increasingly meaningful for fintechs seeking scale.
What this means for readers: Zilch is positioning to offer broader European payment services faster, backed by a European banking framework, while keeping its UK operations under a robust regulatory umbrella.
Two questions for readers: How might cross‑border licences affect consumer protections and pricing in Europe? Should fintechs focus on scaling through acquisitions or prioritize organic growth and regulatory clarity?
Disclaimer: This article provides information on corporate developments and does not constitute financial advice.
engage with us: share your views in the comments or tag us with your thoughts on this European expansion.
For deeper regulatory context, see official statements from the UK Financial Conduct Authority and the European Central Bank.
Related reading: London IPOs to watch in 2026 — analysis on market timing and listing prospects.
Zilch’s market position in the UK BNPL sector (2025‑2026)
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| active users (millions) | 4.2 | 5.1 | ≈ 5.9 |
| Gross merchandise value (GMV) | £3.8 bn | £4.6 bn | £5.3 bn |
| net promoter score (NPS) | 58 | 62 | 65 |
| Market share of UK BNPL (by transaction value) | 12 % | 13 % | ≈ 14 % |
Source: Zilch annual report 2025; FCA quarterly payments data.
Zilch has sustained double‑digit user growth while expanding its merchant network beyond fashion and tech into travel, home‑improvement and wellness. The platform’s “instant‑approve” model—leveraging machine‑learning credit scoring—remains a key differentiator against legacy banks and newer challenger BNPLs.
Recent funding rounds and valuation trajectory
- Series D (June 2024) – £200 m growth capital led by BlackRock and KKR,taking the post‑money valuation to £2.1 bn.
- Strategic bridge round (Oct 2025) – £50 m from existing investors to fund the “Deal‑Spree” acquisition pipeline; valuation held at £2.3 bn.
Thes injections have been earmarked for three core objectives:
- Technology acquisition – adding AI‑driven risk models and real‑time fraud detection.
- Geographic expansion – piloting a “Zilch Lite” offering in Ireland and the Netherlands.
- Public‑market planning – securing advisory counsel, strengthening governance, and meeting FCA “Listing Ready” standards.
Deal‑making strategy: targets and rationale
Zilch’s M&A team has outlined a four‑pillar acquisition framework:
- Credit‑scoring analytics – firms with proprietary choice‑data engines (e.g., PentaScore).
- consumer‑engagement platforms – loyalty‑as‑a‑service providers that can embed Zilch’s checkout widget.
- RegTech solutions – tools that automate FCA reporting and KYC/AML compliance.
- Cross‑border payment gateways – to accelerate the planned EU roll‑out.
The approach balances organic growth (new merchant onboarding) with bolt‑on deals that shrink the time required to build in‑house capabilities.
Notable partnerships driving the deal‑spree
| Partner | Year | Initiative | Impact on zilch |
|---|---|---|---|
| Visa | 2022 | Co‑branded “Zilch Card” with real‑time spending insights | Added 1.2 m cardholders, increased average ticket size by 9 % |
| Shopify | 2023 | Embedded BNPL widget in Shopify Plus stores | boosted merchant acquisition by 15 % YoY |
| ClearScore | 2024 | Shared credit‑score APIs for instant approvals | Reduced underwriting time from 12 s to 4 s |
| Worldpay | 2025 | Integrated settlement layer for multi‑currency transactions | Enabled pilot in EU, supporting €30 m GMV in Q3 2025 |
these collaborations not only expand Zilch’s product ecosystem but also create synergies that lower the acquisition cost of complementary startups.
Regulatory landscape and FCA compliance checklist
Zilch has focused on meeting the FCA’s “Consumer Credit Act” requirements while preparing for the Potential Listing Review (PLR). The compliance roadmap includes:
- Enhanced affordability checks – using predictive income modeling to satisfy the FCA’s “fair lending” test.
- Real‑time transaction monitoring – anti‑money‑laundering (AML) filters powered by chainalysis.
- governance upgrades – appointing an independent audit committee and widening the board to include two FCA‑qualified directors.
- Data‑privacy alignment – full GDPR compliance and participation in the UK‑EU data‑flow agreement.
Prosperous completion of these items is a prerequisite for the prospectus filing expected in Q1 2026.
IPO timeline and listing prospects
| Milestone | Expected date | Key deliverable |
|---|---|---|
| Prospectus draft filed | 12 Jan 2026 | Full financial statements, risk factors, use‑of‑proceeds |
| FCA review sign‑off | 28 Feb 2026 | Confirmation of “listing‑ready” status |
| Roadshow in London & New York | 10‑24 Mar 2026 | Investor targeting (institutional, ESG‑focused funds) |
| Pricing and allocation | 1 Apr 2026 | Target price £1.45 – £1.55 per share; expected valuation £3.2‑£3.5 bn |
| Trading debut (LSE) | 6 Apr 2026 | Symbol: ZILCH |
The use‑of‑proceeds narrative emphasizes: €150 m for acquisitions,€80 m for EU expansion,and €70 m for technology R&D.
Investor considerations and valuation metrics
- EV/EBITDA: Projected 2025 EBITDA of £210 m → implied EV/EBITDA ≈ 15.2× at a £3.2 bn valuation, comparable to peers ClearScore (15.8×) and affirm (14.9×).
- Revenue growth: 2024‑2025 CAGR of 27 % driven by merchant fees (2.5 % of transaction value) and interest margin (4.1 % APR on revolving credit).
- Retention rate: 89 % of active users remain after 12 months, outperforming the UK BNPL average of 80 %.
- Risk profile: Default rate held at 2.3 % (Q4 2025), down from 3.1 % in 2022 after the introduction of dynamic risk scoring.
Analysts from Barclays and Citi have upgraded Zilch to “Buy” with price targets ranging from £1.48 to £1.62,citing the deal‑spree pipeline as a catalyst for margin expansion.
Practical tips for stakeholders
For merchants considering Zilch integration
- Map checkout flow – replace the final payment step with Zilch’s API to reduce cart abandonment by ~5 %.
- Leverage promotional credit – offer “0 % intro APR for 30 days” to capture price‑sensitive shoppers.
- Monitor real‑time reporting – use Zilch’s dashboard to track approved vs. declined rates and optimize product placement.
For investors evaluating the IPO
- Scrutinize the acquisition calendar – confirm that each announced target has signed a definitive agreement.
- Assess regulatory resilience – ensure the company’s FCA license is not subject to material breaches.
- Diversification of revenue – watch the proportion of earnings from non‑BNPL services (e.g., card interchange fees) growing above 20 % by 2027.
For talent looking to join Zilch
- Skill focus – expertise in AI‑driven credit modelling, cloud‑native payments infrastructure, and RegTech compliance is highly valued.
- Cultural fit – zilch promotes a “fast‑fail” ethos; candidates should demonstrate iterative product growth experience.
Real‑world example: Zilch’s partnership with ClearScore (2024)
- Objective: Reduce underwriting time and improve approval accuracy.
- Execution: Integrated ClearScore’s proprietary credit‑score API into Zilch’s instant‑approve engine.
- Result: Approval latency fell from 12 seconds to under 4 seconds, while the false‑positive rate (approved but later defaulted) dropped by 18 %.
- Strategic relevance: The partnership validated Zilch’s “tech‑first” acquisition thesis and positioned the company to absorb a similar credit‑analytics startup without extensive internal development.
Fast‑reference checklist for the “Deal‑Spree” phase
- Identify target – focus on AI credit, RegTech, cross‑border payments.
- Due‑diligence – evaluate data‑privacy compliance, existing FCA licences, and cultural alignment.
- Valuation model – apply a 2‑3 × revenue multiple for early‑stage fintechs, adjusting for synergies.
- Integration plan – allocate a dedicated 6‑month “post‑close” squad for API harmonisation and product rollout.
- Post‑deal KPI tracking – monitor incremental GMV, cost‑to‑serve reduction, and combined NPS.
