Using payment language
Words like “wallet”, “deposit”, “withdrawals processed by us” imply custody/payment activity.
- Use neutral language: “funds flow” / “settlement”
- State control points clearly
Boundary explainer
Client Money vs Proprietary Capital
This distinction drives how banks assess risk. If your model touches client money, you are evaluated as a safeguarding / custody risk. If you only trade your own capital, you are evaluated as a business-risk and controls-risk—very different outcomes.
Informational reference only. Do not market “safeguarding” or “custody” claims unless your scope and controls support it.
Comparison
The difference in one page
Banks care less about what you call yourself, and more about where money sits and who controls it.
Client money model
Meaning Funds belonging to clients are received, held, or controlled (directly or indirectly).
Bank focus Segregation, withdrawals, chargebacks, dispute handling, custody posture, and audit trail.
Evidence Policies, account structure, reconciliations, incident response, complaint workflows.
Risk Safeguarding/custody risk, fraud/AML exposure, operational loss risk.
Proprietary capital model
Meaning Trading is conducted using the firm’s own capital; clients are not depositing tradeable funds.
Bank focus Source of funds, treasury controls, revenue model, counterparties, operational controls.
Evidence Corporate bank accounts, capital provenance, governance, risk controls, reporting discipline.
Risk Market/strategy risk + compliance controls risk (not custody-by-default).
Capital Markets context
Where client-facing execution and routing can trigger client-funds questions.
Prop model context
If you operate evaluation / funded trader structures, keep the boundary clean.
Key concept
Custody posture (what triggers deep review)
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Direct custodyYou hold or control client funds/accounts directly.
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Indirect custodyYou can initiate transfers, approve withdrawals, or control access—even if funds sit elsewhere.
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Operational controlYou manage the operational steps that effectively move money.
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Evidence requirementIf any custody posture exists, banks want policies + proof of execution discipline.
How to stay clean
How to state the boundary (safely)
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Say what is trueState where money sits, who controls it, and why.
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Say what you do not doNo deposits, no holding, no withdrawal discretion (if true).
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Align contracts + UXWebsite, T&Cs, UI flows must match the claim.
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Keep “payment” language outDo not imply payment services on this domain.
“We do not hold client funds” is meaningless unless you explain where funds sit and who controls movement.
Avoidable failures
Common misclassifications
These issues create endless “more docs please” loops and sometimes outright rejections.
Claims without proof
“Segregated”, “safeguarded”, “audited” claims get interrogated immediately.
- Only claim what your scope + controls support
- Keep it factual and bounded
Contact
Contact us
For reference enquiries, verification questions, or corrections. This site does not accept applications.
Reference enquiries
Replace placeholders with your final channels.
Include: business model summary, whether you touch client funds, and where settlement occurs.
Reference desk
Contact details
Emailinfo@nevesfinancialauthority.org
Phone+2399087684
LocationNeves (reference) — update as applicable
If you need application intake, use the commercial domain (.com). This .org is a reference site.
