Eligibility Criteria for UK/EEA Non-Bank Payment Service Providers

Introduction

The purpose of this Eligibility Criteria is to ensure that any assessment of a UK/EEA Non-Bank Payment Service Provider (“NBPSP”) is performed in accordance with the law as defined under PSD2’s Article 36, and local equivalents and implementation.

Non-Bank Payment Service Providers include Payment Institutions and Electronic Money Institutions (small or otherwise). This also includes firms who are applying for authorisation for permissions / licences.

All assessments are undertaken on a proportionate, objective and non-discriminatory (POND) basis. To be eligible to receive services, a NBPSP must meet the criteria detailed below.

Eligibility Criteria

The UK/EEA NBPSP applicant must:

Complete and return the ‘Banking Circle Initial Client Questionnaire’ (BCICQ)
Be either authorised in the jurisdictions where the firm has activity, or, be in the final stages of the process of applying for authorisation (final stages means that the majority of the documentation has been provided to the relevant Competent Authority and there is evidence they have responded positively, for example the firm has received a “minded to” approve letter)
Meet minimum revenue thresholds (or pay minimum fees)
Complete Banking Circle’s Safeguarding letter, if safeguarding accounts are required
Comply with all applicable laws and conduct requirements
Have a profile that is of an acceptable standard to Banking Circle, which includes (but is not limited to) Banking Circle reviewing the:
- - Ownership structure (Shareholder Transcripts and Group Chart), including identification and locations of Ultimate Beneficial Owners
  - Evidenced Source of Wealth of the Ultimate Beneficial Owners
  - Experience of the senior management and leadership team (must be of an acceptable risk profile)
  - Description of the firms’ nature of business and an explanation of the services you provide to customers – for example through any Business Model / Plan / Strategy documentation
  - Risk profile of the firms client base, payment flows, and geographical exposures (these must be within Banking Circles Risk Appetite available here)
  - Annual payment volumes and aggregate payment values
  - Reputation of the firm (should not be any material adverse media)
  - Financial profile of the firm (including capital adequacy / the firm being able to meet its current and future liquidity and funding requirements)
Have acceptable Financial Crime Framework and Prevention Capabilities (this includes Anti-Money Laundering (AML), Counter Terrorist Financing (CTF) and Anti-Bribery and Corruption (ABC) controls). These must be of an acceptable profile to Banking Circle, which includes (but is not limited to) Banking Circle reviewing the:
- - Enterprise-wide Inherent Risk Assessment for Anti-Money Laundering and Counter Terrorist Financing
  - Governance Structure, (which should demonstrate clear reporting lines, the understanding of the distinction between 1st and 2nd line roles and responsibilities, and the oversight of Compliance and AML/CTF teams by management)
  - Experience and qualifications of the MLRO, Compliance team and Onboarding team. (These persons must not have any conflicts of interest, for example they should be independent of any income generating departments)
  - Key Policies and Procedures detailing the firms risk mitigation processes
  - Customer risk rating methodology
  - Client Due Diligence and Ongoing Due Diligence processes (including Source of Wealth checks)
  - Transaction Monitoring systems and processes
  - PEP and Sanctions screening
  - AML/CFT Training program
  - SAR / STR filing and reporting processes
  - Investment in appropriate systems for the Client Due Diligence and ongoing Due Diligence processes (examples include screening tools, risk calculators, data bases, etc.)
  - Outsourcing partners and any third parties involved, if applicable
  - Results of any independent AML reviews / audits that the firm may have (this review is at the both the beginning of the relationship and on-going). If no independent AML controls reviews / audits have taken place, the Compliance officer must confirm this, and Banking Circle will undertake its own review of the firm’s Financial Crime Framework and Prevention Capabilities
Have satisfactory records management procedures to retain customer information and the ability to provide Banking Circle any relevant information it may require (for example transaction information, or customer due diligence records).

Application process timeline

The application timeline

Detailed below are the key stages in the application process, who and when your application will be considered, and the number of weeks each stage is expected to take.

Agree the right solution (1-8 weeks) – Subject to applicants’ responsiveness
- - The applicant to complete and return the BCICQ, which will provide Banking Circle with required information on the prospective Clients’ Company Profile, Payment Profile and Customer base
  - Working on the proposed solution with Banking Circle’s Business Development Department, to reach an agreement regarding services requested, the payment flows and pricing
Passing to the Onboarding team (1-2 weeks)
- - The application is considered at this stage to understand if it meets the Eligibility Criteria and can move to onboarding
Client Onboarding (1-6 weeks) – Subject to applicants’ responsiveness
- - The applicant will receive a Client Application Form to be completed, along with a list of documentation to be provided. These will provide Banking Circle with the required information to assess the application from an Onboarding perspective.
  - Our Onboarding team will undertake screening, identification and verification checks; and potentially perform an interview and testing of financial crime controls.
  - Further information may be requested at this stage
Creation of a Client Report for approval (1-2 weeks)
- - The application will be reconsidered in line with the Eligibility Criteria by the Head of Onboarding and the Head of the relevant relationship department
  - Further information may be requested at this stage
Review and feedback by Compliance (1-2 weeks)
- - The application is considered at this stage from a compliance perspective
  - Further information may be requested at this stage
Review by Onboarding Committee (1-2 weeks)
- - The Onboarding Committee receives the information collated above and determines if the applicant is to be approved or rejected. The outcome will be communicated to applicants after the onboarding committee meeting has taken place
Contract Signing and implementation (1-2 weeks) – For accounts to be opened
- - The Business Development Department will have previously sent the contract to the applicant earlier in this process. After the review by the Onboarding Committee, Banking Circle will countersign the contract. Thereafter, the applicant’s requested product(s) will be set up in Banking Circle’s systems

Dependencies that can affect the timeline

Dependencies that could impact the application timeline are:

The prospective Clients’ final agreement on pricing and solution
The prospective Clients’ ownership structure, whenever this may be particularly complex
The prospective Clients’ ability to comply with all applicable laws and conduct requirements
The Company Profile, for example where higher risk geographies, products and / or customers are included in the payment flows
The ability to retain information and provide Banking Circle any relevant information it may require

These dependencies could either require further relationship discussions and/or additional Due Diligence to be applied, which may increase the timelines noted above. If an Industry or Country is Prohibited by Banking Circle as per its Risk Appetite, payments relating to these will not be processed.

Information Required

The information that will be required from each applicant can be found in our BCICQ, the Client Application Form and a document that Banking Circle provides as part of its application process that lists all of the documents needed to be submitted as part of the application. All of these are available upon request.

Nominated persons and decision committees that will consider the application