A plain-English reference to the licensing, compliance, payments and FX terms used across the money transfer industry. Whether you are evaluating remittance software or planning to launch a money transfer business in the UK, these definitions explain the language of cross-border payments in a UK regulatory context.
A Small Payment Institution is a firm registered with the FCA whose average monthly payment transactions do not exceed EUR 3 million. Registration is lighter than full authorisation, making it a common starting point for new money transfer operators. See how the platform supports applicants on the SPI licence applicant page.
An Authorised Payment Institution is a fully FCA-authorised payment firm with no transaction volume cap. It carries higher initial capital, governance and safeguarding obligations than an SPI. Our SPI vs API comparison explains which route suits different business models.
An E-Money Institution is authorised by the FCA to issue electronic money and hold stored customer balances, as well as provide payment services. EMIs suit firms offering wallets, cards or accounts rather than simple transfers.
A Money Service Business provides money transmission, currency exchange or cheque cashing. In the UK, an MSB must register with HMRC for anti-money laundering supervision, in addition to any FCA payment authorisation it holds.
A Money Transfer Operator moves funds across borders on behalf of customers, usually through a mix of agents, digital channels and payout partners. MTOs sit at the centre of the remittance market and are the primary users of remittance software.
The Financial Conduct Authority is the UK regulator that authorises and supervises payment and e-money firms under the Payment Services Regulations 2017 and the Electronic Money Regulations 2011.
His Majesty's Revenue and Customs is the UK tax authority and the anti-money laundering supervisor for Money Service Businesses. Firms operating as MSBs must register with HMRC and maintain AML controls to its standards.
The Payment Services Regulations 2017 are the UK legislation governing authorisation, conduct, safeguarding and transparency for payment firms, transposing much of the EU Payment Services Directive into UK law.
Change in Control is the regulatory process requiring prior FCA approval before any person or entity acquires or increases significant control over an authorised firm. It protects the integrity of ownership in regulated businesses.
Anti-Money Laundering refers to the controls firms use to detect and prevent the laundering of criminal proceeds and terrorist financing. UK requirements flow from the Money Laundering Regulations 2017. Remitz builds these controls into the transaction flow; see the compliance features.
Know Your Customer is the verification of a customer's identity before and throughout a business relationship. Effective KYC underpins fraud prevention and AML compliance, and is a mandatory step in onboarding for regulated money transfer firms.
Customer Due Diligence is the standard set of checks used to identify a customer, verify their identity and understand the purpose of the relationship. It is the baseline risk assessment applied to most customers.
Enhanced Due Diligence is additional scrutiny applied to higher-risk customers, such as politically exposed persons or those linked to high-risk jurisdictions. It involves deeper verification and closer ongoing monitoring.
Sanctions screening checks customers and transactions against official watchlists, including those maintained by the UK Office of Financial Sanctions Implementation, OFAC, the UN and the EU. Any hit must be reviewed before funds are released.
A Politically Exposed Person is an individual entrusted with a prominent public function, along with certain family members and close associates. PEP status signals a higher money laundering risk and triggers enhanced due diligence.
A Suspicious Activity Report is a disclosure that a firm must submit to the National Crime Agency when it knows or suspects money laundering or terrorist financing. Filing a SAR is a legal obligation and part of a firm's AML responsibilities.
Safeguarding is the requirement for payment and e-money firms to protect customer funds by keeping them separate from the firm's own money, typically in a segregated account or through insurance. It ensures customers can be repaid if the firm fails.
The Senior Managers and Certification Regime is an FCA framework that assigns clear individual accountability to senior managers and sets conduct standards for staff, strengthening governance in regulated firms.
Consumer Duty is an FCA standard requiring firms to act to deliver good outcomes for retail customers. It spans products and services, price and value, consumer understanding and consumer support.
SWIFT is a global messaging network that banks use to exchange secure payment instructions across borders. It does not move money itself but carries the standardised messages, identified by BIC codes, that direct settlement.
The Single Euro Payments Area standardises euro-denominated bank transfers across participating European countries, allowing them to be sent as easily as domestic payments. It supports both credit transfers and direct debits.
Open Banking is a UK framework of regulated APIs that lets authorised third parties access account information and initiate payments with the customer's consent. Money transfer firms use it for account funding and identity or affordability checks.
Correspondent banking is an arrangement in which one bank holds accounts and provides services for another. It enables firms to make cross-border payments in currencies and markets where they have no direct presence.
Nostro and vostro are accounting terms for correspondent accounts. A nostro account is one a firm holds in a foreign currency with another bank, while a vostro account is the one that bank holds on the firm's behalf.
Settlement is the final transfer of funds between parties that discharges a payment obligation. Until settlement occurs, a transaction is still in flight and exposed to counterparty risk.
Reconciliation is the process of matching internal transaction records against bank and partner statements to confirm every payment is accounted for. It is essential for financial control and regulatory reporting.
Pre-funding means placing money with a payout partner in advance so that beneficiary payments can be released instantly on the receiving side. It improves customer experience but ties up working capital.
A payout partner is a local bank, mobile wallet provider or cash network that delivers funds to beneficiaries in the destination country. A firm's reach depends on the breadth and reliability of its payout partners.
A corridor is a specific send-to-receive country pair, such as the UK to India, that defines the route a remittance travels. Each corridor has its own pricing, partners and compliance considerations. Explore the routes we support on the corridors page.
The FX markup, or margin, is the spread a firm adds to the wholesale exchange rate when pricing a transfer. It is a primary source of revenue and is often configured per corridor. See how rates and margins are managed on the FX marketplace page.
A multi-currency wallet lets a customer hold, convert and send balances across several currencies from a single account. It supports customers who receive or spend money in more than one currency.
An eWallet is a digital wallet that stores customer funds electronically, enabling instant transfers, payments and balance management within a platform. Learn more on the eWallet page.
An agent is a third party appointed to provide payment services on behalf of a firm, often collecting cash and onboarding customers in local communities. A sub-agent operates beneath a principal agent. See how the platform handles this in agent-based money transfer.
White-label software is built by one company and branded and operated as another company's own product. It lets money transfer firms launch under their own identity without developing a platform from scratch.
Airtime top-up is a service that lets a sender credit mobile phone airtime or data to a recipient abroad, frequently offered alongside money transfer. It is a popular low-value, high-frequency product in many corridors.
See how compliance, FX, agent management and payouts come together in one FCA-ready platform on the remittance software overview.
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