Milestone 1: TabaPay Review

Call to adventure....

Your TabaPay sales representative will send a kick off email inviting you to submit a merchant application, agreement, and supplementary material. The application will collect information about your business, any UBOs, and its authorized signers. The supplementary material will consist of business documentation, policies, financial history, and other items TabaPay may choose to request based on use case and merchant type, as described below.

Minimum requirements for acquiring Sponsorship

To qualify, your company at a minimum:

  1. Provides complete and proper corporate and financial documentation
  2. Has a functioning website that displays Terms and Conditions to the cardholder
  3. Is not subject to any administrative or regulatory enforcement action, pending or threatened class action lawsuits
  4. Does not have any ultimate beneficial owner ("UBO") on any sanctions, watch, or Politically Exposed Persons (PEP) lists
  5. Has never before been kicked of a payment network for violated network standards or rules
  6. Is able to meet financial obligations related to settlement exposure and potential liabilities resulting from adverse events such as chargebacks, fines, or reversals

Please reach out to your sales representative or [email protected] if you have any questions or concerns regarding your use case, merchant category, and related requirements.

Corporate and Financial Documentation

Corporate documentation

• Articles & Bylaws (Incs) or Founding Document & Operating Agreement (LLCs)
• Certificate of Good Standing (issued by Secretary of State where business is incorporated)
• IRS Confirmation Letter of Tax ID
• Signed Equity Capitalization Table (and list of subsidiaries, if applicable)
• Functioning URL to website
• Terms & Conditions with customer
• Privacy Policy
• Marketing Material
• Voided check to Operating or Settlement Account

Financial history

• 2 years of financial statements (companies in business less than 2 years can provide YTD)
• 3 months of bank account statements
• 3 months of merchant processing statements to assess chargeback history, if accepting payments

Common Use Cases with additional requirements

Merchant Category Use Case Description Requirements
Money Transmitter

Merchants that facilitate person-to-person transactions are either licensed (MCC 4829) or rely on license of an FDIC or NCUA member financial institution in good standing (MCC 6012)
Pulling funds from or disbursing funds to cardholders/account holders for domestic or cross border person-to-person money remittance conducted by a licensed entity • Evidence of License(s)
• BSA/AML policies
• Independent BSA/AML Audit
and Management Response
Licensed Lending Institution. Instant disbursements of loans to a cardholder • Evidence of Lending
License(s)
• Lender Attestation (provided
by TabaPay)
Limited Agent or Program Manager enabling Bank-sponsored financial services (i.e.Neobank)

Merchants that facilitate banking-services are either licensed (MCC 4829) or rely on license of an FDIC or NCUA member financial institution in good standing (MCC 6012)
Account-to-Account (i.e. account funding or offloading) • Evidence of License(s)(1)
• BSA/AML policies
• Independent BSA/AML Audit
and Management Response
Business-to-Business Payment Platform Accepting payments from businesses or sending payments to vendor • Evidence of License(s) or
reasoned legal opinion
• BSA/AML policies that
includes a list of prohibited
merchant types
• Independent BSA/AML Audit
and Management Response
Aggregator (Merchant that enable a single use case on behalf of sub-merchants) Use cases vary but fall within two categories: 1. disbursements funded by corporate entities or 2. money transmission or banking related services • KYB policy(2)

(provides the basis for an expediting boarding process; exact requirements vary according to specific use case)
High Risk Merchant (HRM) Use cases vary but networks have specific registration requirements for HRMs to accept or send payments. HRM merchants include crypto, gambing or gambling, merchant • Evidence of License(s)
• 50-state well reasoned legal
opinion from a reputable law
firm
• 3rd party certifications of
geo-locations and age
verification controls
• Screenshots of user's
payment experience (UX/UI
frames)
Marketplace

eCommerce Merchant that enables micro-merchants or gig workers to market their services and accept payment through the merchant's platform
Most common use case is settlement to sub-merchants or wage disbursements to gig workers • Evidence of License(s) or
reasoned legal opinion
• BSA/AML policies that
includes a list of prohibited
merchant types
• Independent BSA/AML Audit
and Management Response

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(1) Evidence of Licensing

Some platforms enabling regulated banking or financial activities, like neobanks (i.e. challenger banks, limited agents or program managers to banks) partner with an FDIC or NCUA member Financial Institution ("FI") rather than become licensed themselves. If this describes your business model, there are two considerations:

  1. In lieu of money transmission licenses, we collect a letter affirming the relationship between you and your bank. TabaPay calls it an Agency Letter as limited agency is the most common type of engagement to an FI.

We will provide a template of that letter to give to your FI which can be amended as needed so long as it establishes:

  • The money transmission and financial-services related activity that TabaPay is supporting is sanctioned and overseen by your partnering FI
  • Your company is not receiving funds resulting from the activity TabaPay is facilitating; the funds remain under the control of the FI and the individual users of your program.
  • Your FI is aware of TabaPay's involvement in the transaction flow
  • TabaPay will be notified should the relationship between you and your FI end.

The letter should be signed by an authorized representative of the FI's legal or compliance department.

  1. Your partnering FI should be clearly disclosed to your users as the purveyor of banking and financial services on your marketing material and in the terms and conditions with your users.

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(2) Know Your Business ("KYB") process

A Trevi Pay Survey of 150 businesses in 2021 found the 98% of businesses "experienced financial losses (averaging 3.5% of a B2B business’s annual revenue) due to successful fraud attacks last year."

Any one of our customers that boards a company as a client on our system is required to have validated the company's existence and good standing and the individuals representing the business as signers to any application or agreement. Please see here for more detail