Draft Details

Number:PAS 201:2018
Type:PAS
Committee:IST/12
Review published:12 Jun 2018
Review end date:11 Jul 2018
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Draft Scope:

This PAS provides a guide to fintechs on the terms and approach used by many financial institutions for collaboration and commercialisation of new fintech propositions.

Its intention is to provide a framework that will allow fintechs to better prepare for and confirm that they are ready to engage with a large financial institution. It provides an explanation of both the commercial considerations and the necessary checks and controls that need to be satisfied to meet business and regulatory demands.

Specifically it will provide:

* key terms and definitions;

* a framework of the categories information, checks and controls necessary to establish a commercial engagement;

* guidance on the preparation, data gathering and steps that a fintech can undertake to facilitate and speed-up the due diligence, on-boarding, commercial and contractual processes; and

* data protection and information security considerations.

It should be noted that financial institutions will have a differing risk appetites, dependent upon their business strategy, the customer segments they support, markets they serve and geographies in which they operate. It will also depend on whether the fintech is to be engaged directly with customers or internally within the financial institution. As such it would not be possible to provide a definitive single guide and process.

This PAS is not intended, therefore, to be a definition of the on-boarding process as this could vary considerably from institution to institution. However, to aid understanding, Figure 1 provides a generic view of the broad stages in taking a new fintech solution from idea to implementation at scale.

Whilst many fintechs are experienced in engaging with financial institutions and the on-boarding requirements, this PAS has been written from the perspective of helping early stage fintechs who may have little or no understanding of the process.

The PAS has been produced predominantly from the perspective of large established UK banking institutions. Whilst much of the guidance is applicable to other financial institutions it does not purport to be exhaustive and all encompassing.

The PAS does not therefore cover:

* specific statutory, regulatory or legal requirements which can be obtained elsewhere;

* every jurisdictional or geographic, regulatory or market specific requirement;

* in-depth definition of processes which may be applied as part of establishing an engagement;

* specific acceptance standards, as these may differ institution to institution; or

* guidance on open banking.

The PAS is predominantly for use by fintechs and other industry-related start-ups. It may, however, be of interest to banks and other financial institutions, accelerators, technology incubators and regulators.

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