Electronic currency is utilized in the operations of payment institutions (PI) and e-money institutions (EMI) in the UK. Electronic currency refers to the monetary value that can be stored in virtual assets. E-money is issued by the EMI based on the funds deposited by customers in amounts that are proportional to the value of the currency being offered. The legitimacy of such a method of making payments has been established by many United Kingdom Financial Conduct Authority (FCA) License. The EMI and PIs are entities that enable the execution of services involving funds anywhere in the world, blurring the boundaries between countries in the process.Although EMIs and PIs are both considered to be non-banking businesses, they are distinct from one another in terms of the structures they take, the operations they do, and the regulations that govern them. These kinds of businesses are considered to be legal companies since they conduct their activities on the basis of an authorisation that enables them to deal with electronic forms of money.Those who have been granted this license are authorized to issue electronic funds, as well as to provide services for the processing of payments and other choices, such as IBAN accounts. Additionally, access is granted to the Single Euro Payments Area (SEPA), which enables customers to receive payments in euros at lower prices and under the same terms and conditions regardless of which type of FCA license they have.As a result of the implementation of new 3D Secure 2 compliance rules and the increasing costs generated by gateways such as MasterCard and VISA, many enterprises are searching for alternate options to their payment solutions in atypical banking institutions. Along with its other services, a BaaS that possesses an EMI or PI license will enable the acceptance of instantaneous and risk-free monetary transactions.Because many BaaS systems use a P2P framework for lending, this encourages the use of virtual currencies as a form of deposits and loans. This, in turn, provides financial leverage and collateral for payment operations.