Banking Circle rolls out new solutions to tackle compliance and reconciliation issues

By Megha Bhattacharya

London-based financial infrastructure provider, Banking Circle has rolled out its Payments on Behalf of (POBO) and Collections on Behalf of (COBO) solutions in a bid to combat the compliance and reconciliation issues faced in global B2B payments. The new solutions are expected to allow payments businesses and banks to deliver service without depending on the costly correspondent banking network or investing in building their own solution.

“Existing solutions do not provide institutions with true unique IBANs, with payments often still received in the name of the payments business or bank rather than in the name of the payer,” explained Anders la Cour, co-founder and Chief Executive Officer of Banking Circle. “And this lack of payments ownership can lead to reconciliation issues which, in turn, can delay settlement times, thereby impacting on cashflow.

According to Banking Circle, the new POBO and COBO solutions aim to address the problem of delays in settlement and impact cash flow brought about my reconciliation issues. They are expected to enable financial institutions to offer immediate visibility of the sender’s details when processing B2B payments, and to collect funds locally into accounts in the underlying customer’s name. Banking Circle states that businesses leveraging POBO and COBO can gain access to an optimized end-to-end payment solution and visible payment chain, which is WTR compliant.

The FinTech’s solutions are currently available globally through SWIFT, Faster Payments, CHAPS, SEPA, and local clearing, as well as payments businesses in 24 currencies and banks in GBP and EUR, with more currencies and local capabilities planned. The solutions can be accessed by new and existing Banking Circle clients, with a connected or unconnected BIC required by the payments business.

“In response, we have built a solution that allows banks and payments businesses to give their customers access to transparent, local payments and collections across borders, without the need for a physical presence or a relationship with a correspondent bank in that region. It was important that our new solution allowed providers to comply with complex payments regulation without Banking Circle taking ownership of the relationship. As a result, the financial institution remains in control of the relationship and customer experience, while Banking Circle provides the infrastructure for payments and collections to be made quickly and at low cost, regardless of international borders.”

Banking Circle, in February, received its banking licence from the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg. The company stated that the licence would allow it to deliver financial infrastructure at low cost with compliance and security as well as enable access to real-time payments regardless of borders and the size of the operator.