When evaluating a payout partner, it’s important to understand your options:
Existing Arrangements:
- Your solution provider, who offers licensed coverage in the United States, may already be partnered with a payout partner through a correspondent agreement.
- This agreement is with a payout partner in the country of the beneficiary.
- If the rates offered by this payout partner are satisfactory, you can proceed with this arrangement.
Seeking Alternative Payout Partners:
- If the rates or the payout partner itself is not to your liking (e.g., they are a competitor), you may want to find an alternative.
- The solution provider may or may not have an additional payout partner to suggest.
- If not, you have the option to introduce your own payout partner.
- This could be a partner you’re already working with or you may opt to become a payout partner yourself.
- To establish this, you must undergo enhanced due diligence with the solution provider and sign a correspondent agreement to become an official payout partner.
Transitional Arrangements:
- A temporary solution is to continue using the solution provider’s current payout partner.
- Meanwhile, you can work on setting up your own payout partner arrangements.
- Once your own arrangements are ready, you can transition to your chosen payout partner.
In summary, the three main options are:
- Use the Solution Provider’s Payout Partner: Accept the existing payout partner’s rates and services.
- Introduce Your Own Payout Partner: If unsatisfied with the existing partner, propose an alternative, which may involve your own resources or a new partner after completing due diligence.
- Transition Plan: Utilize the current payout partner temporarily while preparing to switch to your own partner once arrangements are finalized.
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This page was last updated on November 3, 2023.
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