Agent-of-Payee Model Explained
Overview
The Agent-of-Payee structure enables financial institutions to offer white-label payment services while maintaining regulatory compliance and customer relationships.
Key Benefits
- Regulatory Compliance: BSA/AML, OFAC, and Travel Rule adherence
- Risk Management: Proper custody and segregation protocols
- Customer Ownership: Institution maintains direct customer relationships
- Revenue Retention: FX margins and fees flow to the institution
Implementation
The model requires careful coordination between:
- Primary financial institution
- Payment technology provider
- Regulatory oversight bodies
- Customer due diligence processes