What does it mean when a FinTech or Bank asks you for Source of Funds?

Source of Funds? What it means when asked by a FinTech or Bank

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There are times when financial institutions like Banks or FinTechs are required to confirm the source of funds, as per their regulatory responsibilities.

Source of Funds checks are just one of many activities that regulated companies must perform.

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SOURCE OF FUNDS - OVERVIEW

Source of Funds (SOF) checks should not be as intimidating or confusing as they may seem at first glance. The aim is not to invade your right to privacy but to ensure we, as a financial institution and industry, are not facilitating criminal activities or handling the proceeds from criminal activities. Institutions have numerous rules and flags in place that, once activated, will require us to perform checks and potentially ask our users to provide us with supporting evidence. If a transaction gets flagged then it won’t be completed until the necessary checks have been completed.

SOURCE OF FUNDS - WHY DID MY TRANSACTION GET FLAGGED?

As a financial institution, it is our obligation to protect our users’ account from being used for financial crime, in accordance with the law and regulations. We do this by monitoring each and every transaction that is made within sync. using our automated AI system which is used to spot unusual activity and potentially suspicious patterns. As there are a huge number of checks in place, if a transaction of yours does get flagged it doesn’t mean we necessarily suspect criminal activity, but for our security purposes we are required to ask for the appropriate evidence.

"We monitor each and every transaction undertaken with sync. using our automated AI system."

SOURCE OF FUNDS - WHAT CAN I DO TO PROCEED WITH MY TRANSACTION?

If a transaction of yours gets flagged, you will be notified either via an in-app notification, an SMS, an e-mail or a combination of the three. We will also advise of the relevant information we require to complete your transaction.

However, if you see a transaction has not been completed, and you have not been contacted by us, then please contact our support team. 

SOURCE OF FUNDS - WHAT CAN I USE AS PROOF?

There are numerous ways, and different types of evidence, that you could use for us to be able to complete your transaction. There is not necessarily a finite list of documents that are acceptable, as it will always depend on your individual circumstances. For example you may have received money from a recent sale of your car, so here the proof of Source of Funds evidence would be the contract/change in ownership documentation of that sale.

Other examples of proof of Source of Funds include pay-slips, invoices, investment agreements, loan paperwork, and other documents that show the sale of an item or the provision of a service.

SOURCE OF FUNDS - WHAT CAN I DO TO IMPROVE THE PROCESS?

If you are expecting to conduct an unusually large (by that, we mean in comparison to your previous transaction history) transaction and you think it may be flagged, you can always contact us beforehand so that we can advise you of the information we may require to process the transaction more effectively.

SOURCE OF FUNDS - SUMMARY

Whilst we appreciate that a “Source of Funds” check can sound intimidating, it is a very basic check we need to perform to ensure we meet our legal and regulatory obligations. If we are required to conduct a check, we ask for your cooperation to ensure it is done as quickly as possible, allowing us to complete the transaction for you.

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