MSB Friendly Banks: Is Your Compliance Program Really The Best?

Applying for a bank account as a fintech startup or an incumbent? Got rejected? Ever wondered why? Is your compliance program up to mark? Is it really good? The best out there? Really? How?


Hello, my name is Faisal Khan and I’m banking and a payments consultant. And today we’re going to talk about Compliance Program.

A lot many companies go to banks and then they get rejected because their compliance program is not up mark. And a question I get a lot is why is the bank rejecting me on my compliance why compliance is really good and so forth. Well you have to consider three things I think that’s very important to know:

First, how do you know what the bank’s compliance program is. Many times I’ll hear a customer say or a client say that their compliance program is the best in the world it’s really, really great even its better than the banks.

Have you seen the banks compliance program?

Have you seen the manual? Do you have access to it?

I really doubt it.

So making a very bold claim that your compliance program or your compliance manual is probably the best in the world etc. is not going to win you any favors with the banks. So that’s one.

Second. Do you have a full time compliance manager on board? Someone from the same industry, someone who’s been in banking, someone who’s been in payments, someone who holds value, not someone fresh off the boat but someone who brings a little bit of, let’s say, history with them. Who has the right credentials or she has the right credentials. Here he or she is very imperative to your organization. That is something that banks will look for you know is the compliance manager your full time. Do they have industry experience? Is it someone well known etc. etc.? So that’s the second. That having a full time compliance manager is extremely important. Preferably someone seasoned.

These third and probably one of the most important points as many companies invariably. I mean that’s let’s face it “Copy” or “Cut-and-Paste” existing compliance manuals and will present those to the banks. And they will get rejected because it’s a clear indication of a person who does this 24/7 they can read it and let you know that this is a copied version.

So DO NOT copy a compliance manual that you find or borrow from someone at this present that to the bank.

Make a bespoke manual for yourself. Make a customized manual, customized compliance program for your company, that is very specific to your transaction set. It is extremely essential that you do that.

There are so many great companies out there in the United States for example. Chartwell Compliance comes out I have no affiliation with them just happen to know the guys. And go and hire a professional company to make your compliance program. It is very important that you do that, not just do that but they will also audit your existing compliance program, tell you where the holes are and be able to fix it. I hope I was able to explain the concept a little bit of why having a good compliance program from someone in the industry, from going to seasoned veterans, from getting alliances with companies (that) are known for making compliance program and then presenting that complete document set to the bank for review is extremely important. If you have any questions asked and below I’ll be happy to help.

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