BANKING

Financial institutions definition by FATF

Financial institutions

 

Financial institutions means any natural or legal person who conducts as a business one or more of the following activities or operations for or on behalf of a customer:

1- Acceptance of deposits and other repayable funds from the public.1

2- Lending.2

3- Financial leasing.3

4- Money or value transfer services.4

5- Issuing and managing means of payment (e.g. credit and debit cards, cheques, traveller’s cheques, money orders and bankers’ drafts, electronic money).

6- Financial guarantees and commitments.

7- Trading in:

(a) money market instruments (cheques, bills, certificates of deposit, derivatives etc.);
(b) foreign exchange;
(c) exchange, interest rate and index instruments;
(d) transferable securities;
(e) commodity futures trading.

8- Participation in securities issues and the provision of financial services related to such issues.

9- Individual and collective portfolio management.

10- Safekeeping and administration of cash or liquid securities on behalf of other persons.

11- Otherwise investing, administering or managing funds or money on behalf of other persons.

12- Underwriting and placement of life insurance and other investment related insurance118.

13- Money and currency changing.


  1. This also captures private banking.
  2. This includes inter alia: consumer credit; mortgage credit; factoring, with or without recourse; and finance of commercial transactions (including forfeiting).
  3. This does not extend to financial leasing arrangements in relation to consumer products.
  4. It does not apply to any natural or legal person that provides financial institutions solely with message or other support systems for transmitting funds.

Definition by Financial Action Task Force (FATF)- 2019 in FATF (2013-2019), Methodology for Assessing Compliance with the FATF Recommendations and the Effectiveness of AML/CFT Systems, updated October 2019, FATF, Paris, France

Categories: BANKING

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