The City regulator is on alert for an emergency restructuring of Railsr, one of the UK’s most prominent fintechs.
Sky News has learnt that the Financial Conduct Authority (FCA) is monitoring the situation at Railsr - a banking-as-a-service provider formerly known as Railsbank - which was among the companies to snap up assets from the collapsed German group Wirecard.
City sources said that Railsr was progressing plans to sell its regulated operations to third parties following the termination of takeover talks with Flutterwave, the African payments technology business.
Restructuring experts at Alvarez & Marsal are overseeing the sale process.
It remained possible that the entire business would be sold through a solvent transaction, although an administration of Railsr's parent company has also been one of the options under consideration in recent days, according to insiders.
A spokesperson for the FCA said it "does not comment on individual firms".
One person close to the process said Railsr's board, chaired by the respected businessman Rick Haythornthwaite, anticipated there being an outcome from the sale process as soon as this week.
He only joined the business in the last two months.
A consortium consisting of several existing Railsr investors had also been vying to acquire the company, which specialises in so-called embedded finance solutions such as banking services, credit cards and digital wallets.
Railsr's travails have deepened amid expectations of consolidation in the fintech sector as companies struggle to access sufficient standalone funding to survive.
Railsr itself raised a bridge funding around late last year which was designed to provide enough capital to see it through to a sale.
Last autumn, the company announced the completion of a $46m Series C funding round, although it did not publicly disclose that this took place at a valuation of about $250m - well below that of an earlier fundraising.
Railsr has itself been on the acquisition trail, having snapped up assets from the collapsed German company Wirecard following the exposure of a massive fraud there.
It has raised well over $100m in equity funding, with backing from investors including Visa.
The British company secured a coup last year when it named Mr Haythornthwaite, the former chairman of MasterCard and current chair of Ocado and the AA, as its chairman.
Nigel Verdon, Railsr's co-founder, previously claimed that the company is "transforming the finance industry in the same way that Apple did to the music industry when they created iTunes".
Railsr declined to comment.