Underwriting
Underwriting is the risk-assessment process a bank, EMI, or acquirer runs on an applicant before approval: verifying ownership, source of funds, transaction history, and sector-specific risk factors against the institution’s published or internal risk appetite. It happens once at onboarding and again periodically as a review.
Most high-risk rejections trace back to a file that never matched the underwriting standard of the institution it was submitted to, not to the business being unbankable, and a mismatched application can burn 6-8 weeks before the decline even arrives. Matching the file to the right underwriter’s actual risk appetite before submitting is what changes that outcome.
Know Your Business is the due-diligence process banks, EMIs, and acquirers run to verify a corporate applicant: beneficial ownership, incorporation documents, source of funds, and the nature of the business itself.
De-risking is a bank’s decision to exit or refuse entire categories of client, rather than assess each business individually, in order to avoid the compliance cost of monitoring them.
A Merchant Category Code is a four-digit number card networks assign to classify what a merchant sells, used by acquirers and issuers to price risk and route transactions.
A segregated account holds client funds separately from a firm’s own operating capital, so client money is never at risk if the firm becomes insolvent.