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Issuing Sub-Accounts For End Clients With BaaS

Today’s FinTech’s rely on the ability to issue sub-accounts for end clients in multi-currency fashion. This functionality allows companies to manage funds more accurately as then they receive and send funds in their own name. Leveraging Banking-as-a-Service (BaaS) solutions can simplify this process, enabling firms to launch comprehensive banking services quickly and cheaply.

 

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BaaS

 

Banking-as-a-Service (BaaS) is a model that allows FinTech’s to integrate banking services into their own front-end applications or platforms through APIs and provide end banking services without a need to develop banking networks on their won. Here are the BaaS advantages uncovered:

 

1. Quick Time To Market: BaaS integrations enable FinTech’s to launch banking services in weeks rather than months, significantly reducing time-to-market as the single integration provides multiple payment routes and currencies.

2. Low Cost : A modular, pay-as-you-go approach allows FinTech’s to scale their banking applications in line with the demand from their end clients, optimizing for fixed and variable costs.

3. Flexibility: FinTech’s can choose to integrate full banking software or connect via APIs, catering to both regulated and pre-regulated entities.

 

 

Key Features Of A BaaS Platform

 

When selecting a BaaS platform to issue sub-accounts to end clients, it’s essential to consider the following features:

 

1. Integration Capabilities

 

A robust BaaS platform should offer end-to-end integration for payments routing, FX and potentially transaction monitoring:

- Payments & FX: Proper BaaS should be able to provide a platform with multiple payment routes, currencies and FX capabilities that can be automated with the API.

- Transaction Monitoring: Automated systems to detect and prevent fraudulent activities.

- Digital Assets and Fiat Management: Seamless handling of both digital currencies and traditional fiat currencies.

 

2. Customizable APIs

 

The ability to customize APIs and offer white-label solutions allows businesses to tailor their banking services to their brand and client needs. This includes:

- Customizable Front-End: Branded interfaces for client interactions, ensuring a consistent user experience.

- Back-End Management: Efficient systems for managing client accounts, transactions, and compliance.

 

3. 24/7 Support and Developer Tools

 

Access to dedicated support and advanced developer tools is crucial for smooth integration and operation. This includes:

- Swift Support: Around-the-clock assistance for resolving issues quickly.

- Developer Tools: APIs and SDKs designed by developers for developers, ensuring seamless integration.

 

 

Steps To Issue Sub-Accounts Using BaaS

 

Issuing sub-accounts to end clients has several steps underway, from initial setup to ongoing management. Let’s discuss in detail:

 

1. Choosing Provider

 

A good BaaS provider should have a track record of multiple other FinTech’s using their solution successfully. The platform should not only support your growth ambitions and goals but also be customizable and able to adapt with your company’s growth. Moreover, we highly suggest asking for case studies with similar FinTech’s in your country or a similar jurisdiction to be able to check how it is working in real life. If you would like us to send you a list of BaaS providers based on your jurisdiction, fill out our contact form and we will send it to you by email.

 

2. Setting Up The Infrastructure

 

Depending on your technical capabilities, you can choose to:

- Develop Native Software: Build your banking software and integrate it with the BaaS provider’s APIs.

- Use Provided Tools: Utilize the provider’s front-end and management UI to expedite the process.

 

3. Integrate APIs

 

Connect your product to the BaaS platform’s core banking system using APIs. This involves:

- API Connection: Establish a secure connection to the platform.

- Data Management: Ensure proper handling of client data, including encryption and secure storage.

 

4. Customize The Client Interface

 

Develop or customize the client-facing interface to match your brand book:

- Account Functionalities: Allow clients to manage their sub-accounts, payments and FX seamlessly.

- Transaction Features: Enable local and international transactions, different currencies and if possible digital asset.

 

5. Compliance

 

Ensure compliance with regulatory requirements and monitor transactions for bad actors. This can be automated through the BaaS platform’s built-in tools, however we suggest to implement own monitoring system.

 

6. Launch

 

Once everything is set up and tested, launch your banking services. The BaaS platform should allow you to add features once your business grows:

- Named Account Issuance: Provide personalized accounts for clients in over 80 countries.

- Multiple Correspondent Banks: Facilitate international transactions through various banking partners.

- Digital Wallets and Liquidity: Offer digital currency wallets and liquidity management.

 

 

Case Study: eWallet Catering To Freelancers

 

Consider a fintech startup aiming to offer multi-currency accounts to freelancers worldwide. By partnering with a BaaS provider, the startup can:

- Launch Quickly: Set up the necessary infrastructure and integrate APIs within weeks.

- Offer Comprehensive Services: Provide clients with named accounts, digital wallets, and seamless currency conversions.

- Ensure Compliance: Automate KYC and transaction monitoring to meet regulatory standards.

 

This approach not only accelerates the time-to-market but also allows the startup to focus on core business activities while the BaaS provider handles the technical and regulatory complexities.

 

 

Conclusion

 

Issuing sub-accounts for end clients using BaaS is a strategic move for businesses looking to expand their financial offerings. With BaaS FinTech’s can launch tailored banking services, ensure compliance, and scale their operations to meet growing demands.

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