The FCA's Sponsorship Warning Meets the IFR at Tier 5

Thirteen clubs, eighteen arrangements

The FCA's warning on 3 June was aimed towards the top of the game, and the scale of what prompted it only became clear afterwards.

The regulator had written directly to football clubs, mainly in the Premier League, after identifying sponsorship involving financial-services providers that were not authorised by the FCA. A subsequent freedom of information disclosure showed it had contacted 21 clubs — all 20 Premier League clubs and one in the Championship — and identified 18 sponsorship arrangements involving 13 clubs and unauthorised financial-services providers.

That did not mean those arrangements were unlawful. The FCA stressed that absence of authorisation does not itself establish wrongdoing, and said it had no open enforcement investigations against football clubs.

Its concern was the process by which clubs accepted the money. The FCA wants clubs to understand who they are doing business with, whether the sponsor requires regulatory permission for its activities, where sponsorship funds are coming from, and whether the relationship creates financial-crime or consumer-protection risks.

The number is worth sitting with. Thirteen of the 21 clubs the FCA looked at — clubs with legal departments, compliance staff and external advisers — had entered sponsorship arrangements with financial-services providers that were not authorised. If that is the position at the top of English football, the question of what happens further down largely answers itself.

Where the two regulators meet

The FCA also identified the Independent Football Regulator as one of the organisations with which it was engaging.

That was not the beginning of the relationship. On 24 February the FCA and IFR signed a formal memorandum of understanding setting out how they would cooperate where their responsibilities intersect.

The IFR's boundary gives that cooperation a particular consequence for The Pyramid. Its licensing regime covers the Premier League, Championship, League One, League Two and the National League. Tier 5 is therefore the lowest division in which a club falls inside the IFR regime while also operating under the wider expectations the FCA has now articulated around financial-services sponsorship.

The timing sharpens it. Regulated clubs apply for provisional licences from November, ahead of the 2027/28 season. For a National League commercial director weighing an offer from an unfamiliar financial business, this is not a distant regulatory development. It arrives alongside a licence application.

The burden changes as the money gets smaller

A Premier League club negotiating a principal sponsorship worth tens of millions can involve commercial executives, lawyers, finance staff, compliance specialists and external advisers before a contract is signed. The same institutional depth does not exist throughout the National League, where commercial and administrative teams are smaller and an individual agreement can matter far more relative to club turnover. An offer from a financial, trading or crypto company prepared to pay above the local market is correspondingly more attractive.

The basic checks need not begin with an expensive legal exercise. A club can establish the contracting company, identify its directors and significant owners through Companies House, check the FCA Register to see whether the business is authorised and for which activities, examine any warnings issued against it, and establish exactly what products or services the sponsorship will promote. It can also ask the prospective sponsor directly for its regulatory permissions, corporate ownership and source of funds.

The difficulty begins when those checks produce a complicated answer. A company may be part of an overseas group. One entity may hold FCA permissions while another signs the sponsorship agreement. A business may be permitted to undertake some financial activities but not others. Crypto businesses can fall under different requirements depending on what they offer and how they promote it to UK consumers.

At that point, determining whether a proposed campaign complies with UK financial-promotion rules moves beyond a register search, and a club may need specialist legal or regulatory advice before signing. There is no FCA tariff telling a National League club what it must spend on sponsorship due diligence; the cost depends on the complexity of the counterparty and the promotion.

Which creates an unusual commercial calculation. The sponsor offering the most money can also be the sponsor that costs the most to assess.

What the FCA is worried about

Football gives financial businesses something more valuable than advertising space. It gives them association with an institution supporters already trust.

The June intervention was concerned partly with the possibility that an unauthorised financial business could acquire credibility through its relationship with a club. A supporter may encounter an unfamiliar trading platform or crypto company for the first time because its name is on the shirt, around the ground or in the club's social-media feed.

The FCA therefore expects clubs to look beyond the sponsorship fee. Its warning also raised the source of sponsorship funds and potential money-laundering risks, noting that money received from an unauthorised firm could in some circumstances constitute criminal property under the Proceeds of Crime Act.

Unauthorised does not automatically mean illegal. Some businesses do not require FCA authorisation for the activities they undertake, while others may operate through authorised entities or approved financial promotions. That is precisely why the check matters. The question is not whether a sponsor calls itself a fintech or a crypto company, but what the contracting entity actually does, what permissions it holds, and what the football club will be helping it promote.

The IFR does not approve the sponsor

The FCA–IFR connection needs a boundary of its own.

The Independent Football Regulator does not operate a general approval system for club sponsors. Its statutory focus is the financial sustainability and governance of regulated clubs, while the FCA is responsible for financial-services regulation. The February memorandum provides a framework for cooperation and information sharing where those responsibilities overlap, and the June warning identified financial-services sponsorship as one of the areas in which the FCA was engaging with the IFR.

For a National League club, that means a financial-services sponsorship can sit at the intersection of two regulatory relationships without the IFR approving the commercial contract itself. The club remains responsible for deciding whether to take the sponsorship. The environment in which it makes that decision has become more demanding.

Why Chelsea still matters

Chelsea sit at the opposite end of the economics. The club had reportedly been seeking £50m or more a year for its front-of-shirt position before signing Circle, and the eventual price has not been disclosed.

Circle operates USDC, a stablecoin designed to maintain a value of one US dollar. Its UK entity holds FCA authorisation as an electronic money institution, which distinguishes it from the unauthorised businesses at the centre of the FCA's warning. Chelsea also already have a significant relationship with BingX, the cryptocurrency exchange that continues as an Official Principal Partner for 2026/27.

That makes Chelsea an unusually visible example of how digital-asset businesses have become embedded in football sponsorship — and it shows why "crypto sponsor" is not a regulatory category. Different companies have different corporate structures, products and permissions, and a club cannot establish the regulatory position of a prospective sponsor from the industry label attached to it.

The framework is still changing. A broader crypto regime is scheduled to take effect on 25 October 2027, bringing additional activities within FCA regulation including the issuance of qualifying stablecoins. For clubs selling sponsorship across several seasons, the regulatory position of the sector can change during the life of the contract.

Why the market may push these deals down the pyramid

The composition of football sponsorship is changing at the same time.

Premier League clubs have removed gambling companies from the front of matchday shirts from 2026/27. Betting businesses can still buy other inventory and remain prominent elsewhere in English football, including further down the pyramid. Financial technology, trading and digital-asset companies have meanwhile become substantial buyers of sports sponsorship.

The economics below the Premier League are potentially attractive to both sides. An emerging financial business can acquire naming rights, shirt inventory, digital promotion, hospitality and repeated access to a defined supporter base for a fraction of Premier League exposure, while for the club the same agreement can represent a meaningful proportion of commercial income.

That does not make financial-services sponsorship inherently problematic. It makes the identity and regulatory position of the bidder part of the value of the offer. Two proposals of similar size are not necessarily comparable once the work required to understand and manage the more complex relationship is taken into account — which is a finance decision as much as a sponsorship one.

Why it matters

The FCA's warning was prompted by activity concentrated at the top of football, but its implications do not remain there.

The regulator has made financial-services sponsorship a football-wide due-diligence issue and explicitly identified the Independent Football Regulator as a partner in addressing it. The IFR's jurisdiction ends at the National League.

That makes tier 5 the bottom of a new regulatory overlap: clubs operating on comparatively modest revenues, with smaller commercial and administrative teams, now sit inside football's licensing regime while dealing with expectations from the UK's financial regulator over a potentially valuable category of sponsor — and they begin applying for their licences in November.

The rules do not require every prospective deal to be sent to a City law firm. Many of the first checks are basic corporate and regulatory work a club can do itself.

The risk is knowing when the answer has stopped being basic.

As financial, trading and crypto businesses buy more football inventory, that judgement is likely to become part of running a club well beyond the Premier League.

What to watch

FCA–IFR guidance. The regulators have a formal framework for cooperation and financial-services sponsorship is already an identified area of engagement. More detailed guidance would turn a broad expectation into a clearer process.

The licence applications. Regulated clubs apply for provisional licences from November. How financial-services sponsorship features in those applications, if at all, will show how far the cooperation has developed.

National League sponsorships. Tier 5 is the bottom of the IFR's jurisdiction and the point at which the gap between regulatory expectation and club resource is widest.

Financial-services sponsors below tier 5. The FCA's expectations do not stop at the National League. Clubs further down sit outside the IFR regime but face the same questions when choosing sponsors.

The changing buyer pool. Gambling's removal from Premier League front-of-shirt positions and the growing presence of fintech and digital-asset businesses could change where sponsorship money flows across English football.

The 2027 crypto regime. The broader UK framework takes effect on 25 October 2027, changing the regulatory treatment of additional crypto activities.