How Wallex's Customer Segregated Accounts Keep Your Funds Safe

At Wallex, a key priority is to help our clients do business across borders seamlessly and securely. Ensuring the security of their funds is paramount in delivering this experience.

We do this by storing their funds in customer segregated accounts.

But what exactly are these accounts and how exactly do they keep funds secure? Let’s take a look at just what customer segregated accounts are.

‍

What is a customer segregated account?

A customer segregated bank account is one that is held by a company with an authorised third-party, which is often a bank or financial institution, on behalf of their customers.

Funds from customers are channeled to these customer segregated accounts, and kept separate from a company’s money and assets. This means that any business or operational expenses made by the company are drawn from its own funds and accounts, and not from the customer segregated account.

More importantly, these funds cannot be accessed for a company to repay its debt obligations or if it were to become insolvent. In such cases, customers can make a claim for their funds and it will be returned to them from the customer segregated account.  

In other words, customer segregated accounts help to prevent your funds from being misused, while ensuring that it is always accessible. Providing customer segregated accounts is how Wallex gives customers confidence to make transactions, just like how the Maker-Checker process safeguards funds.

‍

🔑 Read More: The Maker-Checker Process And Its Benefits For Your Business

‍

Why you should look for fintechs with customer segregated accounts

If you’re looking for a fintech that you can perform cross-border transactions with, there are several reasons to only consider platforms like Wallex who store customers’ funds in segregated accounts:

Risk management

Keeping customer funds in a segregated account ensures that their money is insulated against any unforeseen situations regarding the fintech’s finances or debts.  

Liquidity

Customers can claim all funds stored in a customer segregated account when they want to, regardless of whether a company is financially healthy or is insolvent. This helps them to avoid any potential liquidity challenges that might arise from commingling funds.

Compliance

Fintechs that take the extra step to keep their customer’s funds in segregated accounts are effectively demonstrating a commitment to compliance, transparency and good governance. It is a sign that they take their customers’ interests seriously.

🔑 Read More: Wallex Bags Feefo Platinum Trusted Service Award 2023 for Exceptional Service

‍

Are there any disadvantages or downsides with customer segregated accounts?

One of the main barriers for customers is the price of using segregated accounts. Doing so requires them to put up an initial deposit, which can go as high as tens of thousands of dollars. Because fintechs need to ensure the separation of funds, there are additional accounting and record-keeping costs incurred, which are passed on to customers.

Fintechs also have to consider the complexity of the regulatory requirements involved, which may be subject to constant change. If they cannot meet these requirements, then they cannot offer customer segregated accounts, and this can impact the customers’ experience and trust in the fintech.

‍

Wallex keeps all customer funds in a segregated account

Wallex keeps all customer funds in a customer segregated account which is separate from all other Wallex operations accounts.  

One of the biggest perks of having a Wallex business account is that there are no initial deposits, no minimum balances, and no fees to maintain your account.  

Customers can fund their Wallex business account when they need to make payments and keep funds as long as they need to. There are no charges to hold funds in your Wallex business account.

Moreover, as a holder of a Major Payment Institution (MPI) in Singapore, Wallex operates within a very strict framework both for compliance and for the safety of funds in our custody, and take the security of our customers funds very seriously. We are fully licensed and regulated by the Monetary Authority of Singapore (MAS), Bank Indonesia (BI) and Hong Kong Customs and Excise Department (HKCED).  

Open a Wallex business account today and store your funds in a customer segregated account! Get in touch with our team today to find out more!

‍

‍

‍