Fintechs are struggling to hire experienced compliance staff, and many now turn to a fractional compliance officer instead. We asked industry leaders when that works, and the rules show you can rent the hours but not the accountability.

Compliance talent is scarce and expensive. Barclay Simpson’s 2026 Compliance Salary Survey found that 93% of UK employers struggle to hire the right people, and 61% say shortages are hurting team performance. Meanwhile, the people who carry personal liability are stepping back. CUBE’s 2026 Cost of Compliance report found 35% of firms see senior leaders declining or leaving roles with direct compliance accountability. As a result, many founders now ask whether a fractional compliance officer can fill the gap.

We asked fintech founders, COOs and compliance chiefs one question: how are fintechs finding and keeping good compliance people, and when does a fractional or outsourced compliance officer make more sense than a full-time hire? Two people answered, and we used both. However, both are finance leaders who sell fractional CFO or outsourced finance services, and their answers focus mainly on finance roles. So we tested their advice against the rules that govern compliance roles in the UK, US and EU.

The fractional compliance officer market in numbers

First, the costs. Robert Walters puts a fintech MLRO in London at £90,000 to £130,000 a year. By contrast, recruiter FD Capital quotes a fractional compliance officer or MLRO at a small firm at £400 to £650 a day. At one or two days a week, that comes to roughly £30,000 to £60,000 a year. Those figures come from recruiters that place interim staff, so treat them as a guide. Still, the gap explains the appeal. Barclay Simpson also found that 72% of employers regularly use interim support.

Retention is the other half of the problem. In the same survey, 63% of candidates said they would consider moving if they could not get their preferred hybrid arrangement. Also, 26% of employers now require four or five office days, up from 8% in 2023.

The CFO test, and why compliance is different

Our first respondent founded Profitjets, a Delaware-registered accounting and bookkeeping firm with its team in Bengaluru.

Choosing between full-time and fractional leadership comes down to how often you need senior judgement. In finance, we consider fractional leadership when those decisions come up now and then. For example, a company may need CFO-level input once a month rather than every week. In that case, a fractional CFO may be the most suitable and cost-effective option. Once CFO-level decisions become part of day-to-day business, a full-time CFO is usually warranted.

Abhinav Gupta, Founder, Profitjets

Abhinav’s frequency test works well for finance leadership. However, it fits a fractional compliance officer less neatly. An MLRO must handle suspicious activity reports, urgent regulator contact and sanctions hits when they happen, not on a monthly cycle. Therefore, availability matters more than how often senior decisions arise. The law also requires a named person. The UK’s Money Laundering Regulations require firms to appoint a nominated officer and tell their supervisor within 14 days. Profitjets sells outsourced finance services and is not a fintech, so readers should treat this as a finance comparison.

Fractional compliance officer roles suit projects, not accountability

Our second respondent is a chartered accountant and CFO of Verloop.io. He also runs CFO Matrix, a fractional CFO practice in Bengaluru.

If there is ongoing work, it makes sense to employ someone. If the work is project-based, such as licence applications or audits, fractional makes sense, because you only pay for the time the project takes.

On retention: in my experience, the people who stay in finance roles understood what they needed to do within the first month and knew who to contact when issues came up. Those who left often said the job had become the “catch-all” role.

With a fractional hire, you won’t have someone with deep knowledge of your business, and they can be hard to reach. You can agree in writing how quickly they will respond and who covers for them.

I’m not sure this applies to compliance roles, because a regulator will sometimes want a specific person to be accountable.

Ankit Sarawagi, Curator, CFO Matrix

Ankit’s caveat is correct, and if anything it understates the rule. The FCA’s SYSC 3.2 states that “a firm cannot contract out its regulatory obligations”. At firms under the Senior Managers and Certification Regime, the compliance oversight (SMF16) and MLRO (SMF17) roles need FCA pre-approval. A fractional compliance officer can hold them, but only as a named, approved individual with enough time for the job.

His project test also needs care. A fractional compliance officer can help draft a licence application. Yet the FCA expects named officers to be in place when the firm applies, so that adviser often has to stay on. Some audits must also be independent of the person running the programme. In addition, his “catch-all” point matters. FinCEN’s April 2026 proposal warns against an AML officer overburdened with other duties. CFO Matrix sells fractional CFO services, and Verloop.io is not a regulated fintech.

When growth outruns the compliance team

The enforcement record shows what happens when a part-time setup stops matching the risk. The FCA fined Monzo £21,091,300 in July 2025 after its customer base grew almost tenfold while financial crime controls failed to keep pace. Similarly, New York’s regulator fined Block $40 million in April 2025, saying compliance functions must keep pace with growth. Partner banks now check the same thing, as our look at embedded finance compliance after launch found. So a fractional compliance officer who suited a pre-launch fintech may not suit it at scale.

What to watch next

Next, watch FinCEN. Its proposal would require a US-based AML officer. If FinCEN finalises it as written, that would rule out an offshore fractional compliance officer. In the UK, the FCA’s PS26/6 now gives firms 12 weeks to submit an SMF application while an interim holder covers. The FCA’s second consultation, CP26/37, proposes further changes. Then, from 10 July 2027, the EU’s AML Regulation requires a management-body compliance manager, as our EU AMLR readiness guide explains. Also, the UK safeguarding regime that began in May 2026 adds monthly returns and annual audits, which pushes payments firms towards steadier capacity.

Above all, a fractional compliance officer is a staffing choice, not a way to share out responsibility. It suits small, lower-risk firms with clear duties, written response times and cover arrangements. Once alert volumes, licences or partner bank demands grow, the role needs more hours, and often a full-time hire.

FintechBits covers payments, banking and fintech developments for readers in the US and UK. This article is for information only and is not financial or legal advice. Views expressed are those of the FintechBits editorial team.