What to look for in Banking Partners

For Trust and Corporate Service Providers, strong banking relationships are not just beneficial — they are absolutely critical. A bank is not simply a service provider where you open accounts and process transactions. We deliberately refer to banks as “Banking Partners” because the relationship should be a genuine partnership built on mutual trust, understanding, and shared goals.

Getting this relationship right means more than ticking boxes during onboarding. It means understanding the nuances of how each bank operates, what they expect from their clients, and how they can support the unique needs of a TCSP and its underlying client base. In this article, we explore five key considerations that every TCSP should keep in mind when evaluating and engaging with banking partners.

Client Bank Accounts, Risk Profiles, and Credit Ratings

Consideration 1: Understanding Client Profiles and Matching Banks

Not all clients are the same, and not all banks are willing to service every type of client. TCSPs manage a diverse portfolio of structures — holding companies, trading entities, family offices, funds, and special purpose vehicles — each with varying risk profiles, industries, and jurisdictions.

The first step is to categorise your client base by risk level, industry sector, and jurisdiction. Some banks specialise in high-net-worth individuals and family offices, while others focus on corporate treasury or trade finance. Matching the right client to the right bank is fundamental. Placing a high-risk client with a bank that has a low-risk appetite will create friction from day one, leading to enhanced due diligence requests, account freezes, or even account closures.

Take the time to map out your client base and understand which banking partners are best suited for each segment. This proactive approach saves enormous amounts of time and frustration down the line.

Consideration 2: Bank Credit Rating

A bank’s credit rating is a key indicator of its financial health and stability. When your clients are depositing significant sums, you have a fiduciary duty to ensure those funds are held with institutions that are financially sound.

Credit ratings from agencies such as Moody’s, S&P, and Fitch provide an independent assessment of a bank’s ability to meet its financial obligations. A strong credit rating gives confidence that the bank is well-capitalised and managed prudently. Conversely, a deteriorating credit rating should raise red flags and prompt a review of the relationship.

TCSPs should regularly monitor the credit ratings of their banking partners and have a policy in place for what action to take if a rating falls below a certain threshold. This is not just good practice — for many regulated TCSPs, it is a compliance requirement.

Client and Bank Profiles

Each bank has a different target client profile, and understanding this is essential for building an effective banking network. Some banks are eager to work with TCSPs and understand the intermediary model, while others prefer to deal directly with end clients and view TCSPs with caution.

When evaluating a banking partner, ask yourself:

• Does this bank understand the TCSP model and the role we play?
• What types of structures and jurisdictions does this bank welcome?
• What are their minimum deposit or balance requirements?
• How do they handle politically exposed persons (PEPs) or clients from higher-risk jurisdictions?
• What is their appetite for complex structures with multiple layers?

Having clarity on these questions upfront prevents wasted effort in trying to onboard clients with banks that will ultimately decline them. It also helps you build a diversified banking network that can accommodate the full spectrum of your client base.

Interest and Products

Banking is not just about holding money in current accounts. For TCSPs managing client cash, the range of products available from a banking partner can make a significant difference to client outcomes and satisfaction.

Current Accounts remain the foundation — the day-to-day transactional accounts that every entity needs. But beyond current accounts, there are opportunities to optimise returns through other products.

Fixed Deposits allow clients to lock away surplus cash for a defined period in exchange for a higher interest rate. For clients with predictable cash flows and funds that are not immediately needed, fixed deposits can meaningfully improve yield.

Notice Accounts offer a middle ground — better rates than current accounts with more flexibility than fixed deposits. The client gives a notice period (typically 30, 60, or 90 days) before withdrawing funds, and in return receives an improved rate.

Consideration 3: Open Dialogue with Banking Partners

Understanding what products each banking partner offers — and on what terms — requires open and ongoing dialogue. Interest rates change, new products are launched, and terms are updated. TCSPs that maintain a regular conversation with their banking partners are better positioned to take advantage of opportunities and deliver value to their clients.

Do not be afraid to negotiate. If you bring significant deposits to a bank, you have leverage. Use it to secure better rates, reduced fees, or preferential terms for your client base.

Technologies

The banking industry is experiencing a wave of innovation, and TCSPs need to be at the forefront of understanding how technology can improve their operations and client experience.

Consideration 4: Know Your Technology Requirements

Before engaging with a banking partner on technology, you need to understand your own requirements. Consider the following:

SFTP (Secure File Transfer Protocol): Many banks offer SFTP connectivity for the automated exchange of statements, payment files, and other data. This is often the most practical and widely supported method for TCSPs to connect with their banking partners. If you are processing high volumes of transactions, SFTP can dramatically reduce manual effort.

APIs (Application Programming Interfaces): APIs represent the cutting edge of bank connectivity. They allow real-time data exchange between your systems and the bank’s systems. While not all banks offer API access, those that do can provide real-time balance information, instant payment initiation, and automated reconciliation.

Virtual Banking Platforms: Some banks offer white-label or virtual banking platforms that allow TCSPs to manage multiple accounts through a single interface. These platforms can simplify account management and provide a consolidated view of all client accounts.

Middleware and Integration Platforms: Solutions like Flinq sit between the TCSP and its banking partners, aggregating data from multiple banks and providing a unified view. Understanding whether your banking partner can integrate with middleware platforms is an important consideration.

The key is to have a clear technology roadmap and to evaluate banking partners against it. A bank that offers great rates but no technology connectivity may ultimately cost you more in manual processing time than the interest benefit provides.

Account Opening and Relationship Management

The account opening process is often the first real test of a banking partnership. It can be smooth and efficient, or it can be a drawn-out, frustrating experience that sets the tone for the entire relationship.

Virtual Bank Accounts are an emerging trend that can simplify the account opening process. Instead of opening a separate physical account for each entity, some banks offer virtual accounts that sit under a master account. Each virtual account has its own unique reference, allowing for full segregation of funds while reducing the administrative burden of opening and maintaining hundreds of individual accounts.

The Obliged Person regime in many jurisdictions places responsibility on the TCSP to conduct due diligence on clients. Some banks are willing to rely on the TCSP’s due diligence, while others require their own independent verification. Understanding where each banking partner sits on this spectrum is crucial for managing the account opening timeline and client expectations.

Digital ID Verification is becoming more common and can significantly speed up the onboarding process. Banks that have invested in digital verification tools can often open accounts faster and with less paperwork than those still relying on traditional methods.

Consideration 5: Spend Time Talking

This may seem obvious, but it is perhaps the most important consideration of all. Spend time talking to your banking partners. Not just when you need something, but regularly and proactively.

Understand who your key contacts are at each bank. Build relationships with the relationship managers, the compliance teams, and the product specialists. When issues arise — and they inevitably will — having a strong personal relationship makes resolution faster and smoother.

Invite your banking partners to your offices. Visit theirs. Attend industry events together. The strength of the personal relationship often determines the strength of the business relationship.

Roundup

Building and maintaining strong banking partnerships is arguably the single most important activity for a TCSP managing client cash. It requires ongoing effort, open communication, and a willingness to invest time in understanding each partner’s capabilities, appetite, and technology.

The five considerations outlined in this article — understanding client profiles, monitoring credit ratings, maintaining open dialogue, knowing your technology requirements, and spending time talking — provide a framework for evaluating and strengthening your banking relationships.

A strong banking partnership is probably the key to delivering exceptional service to your clients, optimising returns, and building a sustainable, scalable business. It is not something that can be set up once and forgotten. Like any good relationship, it requires continuous nurturing and attention.

At Flinq, we work alongside TCSPs and their banking partners to make these relationships more efficient and productive. If you would like to discuss how we can help, please get in touch.