Operations Related Frequently Asked Questions

Table Of Contents

How long does it take to be up and running for Remittance as a Service?

The answer always is, it depends. But on average, you can be up and running in 4-5 weeks if all of your information, technology, and monetary factors are ready. Most clients are up and running in 6-8 weeks. Needless to say, if you are opting for the API solution and building your app on top of the API, then it comes down to your technical capabilities on how efficiently you can build your app and then present it for an audited approval by the PLH (principal license holder).

Considering that our app is used for other services Can we still use the same PLH API for our wallet Top-Up for services not meant for remittance purposes?

No, this is not allowed. However, a special request can be placed with the solution provider to allow this.

Why do I have to put up the pre-funding money?

Pre-funding money is always put up by the entity that is generating (or originating) the transaction. In this case, the solution provider is generating the transaction, but they are doing so, for you, on your behalf, as you want to be in this business. As that is the case, you will have to front the pre-funding money. No solution provider is going to put up their own capital for you to benefit from. If you were to get your own licenses in the United States, would you not have to put up the pre-funding money in the payout countries? So, the same scenario here.

Is there any chargeback or fraud protection included for us?

Most of the solution providers have implemented various tools to mitigate disk, such as bank login and balance check for ACH, (address verification service) for the debit card, risk scoring on the users, etc.

At the end of the day, remittance is considered ‘high-risk’ by the banks. This is why banks pass the onus of the fraud/chargeback to you, and hence you would be required to keep a reserve.

In Remittance-as-a-Service (RaaS), If I understood you correctly, I will just simply give you our branding (LOGO) and we will be good to go?

This assumes that you will opt for the website option (see Option # 2), see the various RaaS pricing options here. That is the minimalist approach. You give your logo, and you simply market the website that would be white-labeled for you.

For example, your company is called ABCMoneyTransfer.com – then you market this website. The license holder will run and maintain this website for you. As you learn the business more, you can then opt to go on your own.

What if we want our average transaction size to be $10,000 – is that possible?

The average transaction size mentioned by the client is $5,000. This will be as per the CIP and will be determine after the DD.

Can we originate from Country X and terminate money transfer transactions into the United States?

No. At present, the program (currently) shall only support US origination.

Can my User receive into the US via the same wallet to wallet transfers from the selected payout Countries, and what are the available cash-out channels here in the US?

At present, the arrangement is one-way, US to Country X. In Q2 (hopefully) by 20201, 2-way traffic would be allowed and the payout option would be direct bank account credit in the US only.

Our App is a multi-service application that has other services as well as the cross-border transfer; like E-commerce and Payment Processing. Do we have to restrict those other services we provide to our customers?

Remember all development you do on your app, can have a multitude of services. What is important that when your customer comes to the section in your app for money transfer – there should be NO ambiguity or confusion about the service(s) the customer is available. It should money and money transfer ONLY. Any development you do, would have to pass the audit on the look and feel (as per the guidelines) set by the US Solution Provider (keep that in mind). But to strictly answer your question, there is no restriction on bundling other services on your app, as long as boundaries can be maintained.

I am really interested but I really would like to have higher limits once we start, I keep thinking that offering higher limits will be a great addition to get clients. Maybe US$ 10,000 in ACH is too much at the beginning but could we set up the limits at least US$ 5,000 for debit cards and ACH? And after 90 days we can review if we get higher or maybe lower the limits depend on how it goes, the main idea for me to get new clients is to have higher limits, especially when it comes to sending money to Europe, normally 2K is too small, I face this problem myself and I would like to offer a solution for clients.

Apologies. The limits stand at present. These might be relaxed after a 90 days review.

If I have to pay a bigger reserve or something like that I will be happy to do it if we can have the limits raised to 5K, as I said, only WorldRemit and Western Union offer those limits and that is the kind of company I want to have in the future if everything goes well.

As I cited. You can request a review for higher limits once you are operational and have 90 days of working history under your belt. No service provider is going to unilaterally allow you higher limits from day one. They would like to have a rapport with you and then together you can slow increase the limits as deemed safe by both sides from a risk point of view.

Can we be up and running in 15-days?

The answer is always, it depends. If everything is catered for and supplied without any hiccups, then the answer is yes. Else, it usually takes between 3-4 weeks after the signing of the contract to be up and running on the simplest model, i.e. where you seek a white-label web solution, with no integration, to a payout country that is easily approved.

Be cognizant, you would need to pass the due diligence before your contract can be signed. Due diligence on your initial application can take between five to fifteen days and this is a process no one can accelerate.

Do you provide access to banking for the Remittance-as-a-Service (RaaS)?

If by access to banking you are implying do we provide a bank account in the US for the commissions &/or customer funds to be pushed into – the answer is no.

If you are an ISO, you would need to make arrangement in the US to have your own company incorporated and have a US bank account to receive commissions, or for the solution provider to either SWIFT (international wire transfer) the money across to the correspondent’s bank account in their payout country or the correspondent may have a Nostro account in the US.

Either way, access to banking is not provided for. You have to make arrangements for it, or you can contact us to separately provide you access to banking services.

Why is the limit for the starter package limited to $5,000 per day?

Limits in the starter package are directly 1-to-1 proportional to the pre-funding deposit you place. If your pre-fund deposit is for $5,000 then you get a daily limit of $5,000. The $5,000 per day limit is the minimum. If you place a daily deposit of $15,000 then your daily limit is set to the same amount.

Given the above situation, can the Principal License Holder (PLH) send money to anywhere in the world, provided the bank account is in the direct name of the European License Holder’s name? Yes or No?

Yes. However, excluding the sanctioned countries and few countries that might be flagged by the MSB and/or their bank. Please ask in advance.

For the RAAS service starter package “Daily transactions limits: Your daily limit corresponds directly to the amount of money you have held in reserve for pre-funding. Default is US$ 5,000”. Can we increase our deposit for this particular package?

Yes, your daily limit corresponds to the reserve. If you increase the reserve, the daily limit for the Starter package is equally raised. The minimum value is US$ 5,000 in reserve. There is no upper limit.

Do you provide a settlement wallet/account for settlement?

The answer is No. The settlement partner (if provided by the solution provider), then the settlement account is already taken care of. You simply would need to provide us with a bank account for your commissions where they would be deposited.

If the settlement partner (or payout partner) is one that is suggested by you, then the payout partner has to first have a correspondent agreement with the solution provider and once that is established, the payout partner must either provide a Nostro account in the US (in their name) or a bank account anywhere else in the world, with the account title in their name.

Settle into a US Bank Account (Nostro) via FedWire. Is this an account held in a foreign country? Would that be classified as Nostro accounts?

There are two scenarios in which this can be played out:

(a) You are a licensed payout partner with a direct correspondent tie-up agreement with the US solution provider (i.e. the license holder). In this case, you, as the payout partner, ‘may’ have (on your own arrangement) a bank account in the United States, held with a licensed bank to receive money in. This account is designated as a Nostro account for you, the licensed payout partner.

The US solution provider (i.e. the license holder) that is holding on to your funds, can now push the money into your Nostro account and then that money is now considered ‘delivered’ and settled to you. For the US provider, there is no international SWIFT / Wire transfer. The settlement is quick and usually on the same day (if not the same hour (if FedWire is used).

(b). In the alternative scenario, you are a marketing company that is managing and running the remittance-as-a-service program. The US solution provider already has arrangements with a payout partner (whether through you or not, is irrelevant), and as before in the above-mentioned case, the funds held for the payout partner will be pushed to the Nostro account of the payout partner.

You, as the entity that is running the remittance-as-a-service program, can request the solution provider to push your ‘commissions’ into a bank account that has the same title as your company’s name. This bank account could be in the United States or abroad.

Lastly, if I start with the starter package, how much do you think I have to have in my budget to have everything operatives in the shortest amount of time? Just tell me a number that would an estimate.

Sorry I cannot provide this information. Our start and finish is limited to the objectives around remittance-as-a-service. The merchantability and/or the feasibility numbers around it, is something we do not provide nor comment upon.

Do you take care of all the needed paperwork?

We don’t. We are introducers/brokers You need to have your company and the DD documents sorted out yourself.

Can you send money to a 3rd Country (like China or European Country, etc.)?

You can but only if one condition is met. The bank account to which the money is being sent, must be in the same name of the payout partner with which the US solution provider (i.e. license holder) has signed a correspondent tie-up agreement with.

For example, if there is a payout partner named ABC Transfers in Kano, Nigeria and they request payment to be made in Europe or China into a bank account of their choice. The bank account has to be in the name of ABC Transfers, else the US solution provider will not agree to the transfer.

Transfers cannot be made to 3rd party bank accounts.

Can the daily transaction limits be increased by increasing the reserves? If Yes, how long does this process take?

The daily limits can indeed be increased by increasing the reserve. They are effective the next business day once the funds have been received by the solution provider.

In the event you have your own payout partner (which has a correspondent tie-up agreement with the US solution provider), then the daily reserve requirement is not applicable.

Settle into a US Bank Account (Nostro) via FedWire. If this option is chosen, what component of the transaction is settled here? Are the funds not being sent to the destination country bank?

When a transaction is complete, the US solution provider is essentially holding to you the funds (minus their commission). These funds can be pushed into the local US Nostro account (via FedWire), from where the payout payment will have control of the money, or if the payout partner does not have a US Nostro account, then the funds are sent via international wire transfer, i.e. SWIFT to the bank account in the name of the payout partner in the country of their choice.

All of the money is transferred here (minus the solution provider’s commission).

Are B2B (Business to Business) transactions allowed? If intermediate MNO’s are used, will this be allowed?

No, B2B transactions are not allowed under ‘remittance’ as a service. The model is purely for P2P (person to person).

Can we operate on a funds good & settled model?

A good funds and settled model implies that no credit is being extended, and the funds have been settled into the terminating (intended account). That is exactly the model on how this remittance-as-a-service operates.

However, you cannot and are not allowed to operate the service by asking the solution provider to take the funds that have been settled and push these for further beneficiary delivery.

The US solution provider needs to see proof of delivery of funds (using pre-funding) and only then the funds are released from the United States.

This page was last updated on December 24, 2020.

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