FBO accounts for fintechs, payfacs and MSBs

Last updated October 11, 2026

An FBO (for benefit of) account holds funds for your customers at a bank. For FDIC pass-through coverage, the custodial relationship must be disclosed in the account records and each owner's share must be ascertainable. We introduce fintechs, payfacs and MSBs, including foreign fintechs, to banks that will review the structure. Approval is never guaranteed.

We place payment processing, business banking and crypto rails for high-growth, complex businesses with institutions that take the industry, then watch the chargeback ratios, reserves and reviews that get accounts closed, with more than one rail so one bank's no doesn't stop the business. Approval is never guaranteed.

Break free How it works

Who it's for

Payfacs holding merchant funds
Fintechs holding customer balances
MSBs that need a settlement or FBO structure
Foreign fintechs that need the FBO at a US bank

What the bank needs

Who the beneficial owners of the funds are
The program agreement you want the bank to accept
Flow of funds
The compliance program you run, and any licenses you hold
Reconciliation and how ledgers map to the account

What makes an FBO account work for deposit insurance?

FDIC rules recognize pass-through coverage only when the fiduciary or custodial relationship is expressly disclosed in the bank's account records, and the owners and their interests can be ascertained from the bank's or your records (12 CFR 330.5). In practice, that means ledgers that reconcile to the account. The bank's counsel and your agreement set the rest.

What will the bank worry about?

Regulators flag operational, compliance and liquidity risk, end-user confusion, and misrepresentation of deposit insurance coverage in fintech deposit programs (OCC Bulletin 2024-20). Come with a ledger the bank can test.

How do we help?

We're not a bank, processor, or money transmitter. We structure the deal, build the file, and place it with institutions in our network: decades of relationships with 40+ financial institutions and solution providers. The bank decides, and approval is never guaranteed.

Questions

Is money in an FBO account FDIC insured?

Only if the pass-through requirements are met, and only up to the per-owner limits at that bank. Ask the bank how it treats your program.