A PayPal-backed UK fintech which provides services to the HMRC is locked in a legal battle with a former client over an accusation of unpaid pre-determined charges.
Embedded payments firm Modulr has filed a winding up petition against Paymob Technology, which trades under the moniker Dapio. A Judge will hear the case on Wednesday October 22.
Dapio provides firms additional options to accept payments amid the accelerating pivot from tangible cash.
The firm raised $3.2m (£2.6m) in 2024 as part of plans to launch its Android-based tap to pay service in the UK and Europe.
A spokesperson for Modulr said: “Modulr has initiated winding up proceedings against a former client, Paymob Technology Ltd, to recover unpaid contractual fees.
“This action follows Paymob’s failure to meet payment obligations and is a standard step in our commercial debt recovery process.”
Dapio did not respond to numerous requests for comment.
Modulr backs off crypto market
Modulr, which is backed by PayPal’s venture capital arm, employs over 300 people and provides its payment services to firms such as Sage and Wagestream.
The firm reported a loss of £11m in 2024 but marked a reduction on losses of £13.9m in the previous years.
Revenue came in at £52.8m, compared to £47.9m the previous year.
The fintech defended the losses as being covered by its $108m (£83m) in Series C funding and added the company ended the year with £31m of cash.
Over 200m transactions and over £100bn of payment values are processed on Modulr’s platform on an annual basis, the business said.
The firm serves over 240 enterprises and over 4,000 small- and medium-sized enterprise customers.
In 2024, Modulr began rowing back on the crypto market and pushed focus onto client sectors of travel, merchant payments and lending.
The London-headquartered fintech also made its first international expansion after securing a contract with a “major” US financial technology company.