Regulatory Alerts2011-12-22
Added · Updated
Onward payments and the prohibition under Section 3:5 of the Wft
Funds retained by a third party for onward payment are not considered repayable funds under Section 3:5 of the Financial Supervision Act as long as the link with the underlying transaction exists. This link is presumed to exist if the retention period does not exceed five calendar days, though longer periods may be justified for technical or administrative efficiency, such as batch processing or verification steps. Retention periods exceeding one month are generally unlikely to qualify unless exceptional circumstances apply, and funds held without a specific underlying agreement do not meet the criteria.
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