Best Practices for Banking as a Service (BaaS)
February 2024 - FinTechs need a Partner Bank to provide them with traditional banking services or to facilitate traditional banking products on behalf of the FinTech. The Partner Banks must have robust vendor management and Enhanced Due Diligence controls to manage these relationship risks successfully. Our expert panel discusses best practices for Partner Banks that take on FinTechs and other customers that require BaaS assistance, such as Money Services Businesses (MSB) and Cannabis Related Businesses (MRB), such as
• Enhanced Due Diligence prior to onboarding
• Ongoing monitoring, including transparency to the activity of their customer’s customer
• Regulatory oversight and management
• The use of technology and vendors to assist with BaaS
• When to exit a relationship.