Types of bank accounts
There are three main categories of bank accounts you can open with Griffin:
- accounts for holding your business’ operating funds:
- Operational accounts
- accounts for holding money on behalf of your customers (and sometimes their customers)
- Safeguarding accounts
- Client money accounts
- Embedded accounts for offering savings products to your customers
- Easy access savings accounts
This guide will break down what each type of bank account can and should be used for. Some bank accounts are only available to organisations with specific regulatory permissions.
Holding your own funds
Operational accounts
Operational accounts are basic transactional bank accounts.
When you go live with Griffin, you’ll get an operational account as standard. Typical use cases include:
- Holding funds from a bulk transfer before disbursing to other accounts
- Pooling interest earned from multiple accounts
- Paying fees
- Funding additional payments to a customer’s account (e.g. an interest rate top-up)
Holding your customers’ funds
Safeguarding accounts
Safeguarding accounts are available to electronic money institutions (EMIs) or payments institutions (PIs), authorised and regulated by the FCA.
Safeguarding accounts are used to keep your customer’s funds ringfenced from your own operational funds. This is a regulatory requirement for EMIs and PIs. Your own funds should be held in separate operational accounts, and your safeguarding accounts should only contain customer funds.
You can hold funds from each of your customers in dedicated safeguarding accounts, or hold all your customer’s funds in a single pooled safeguarding account.
Client money accounts
Client money accounts are available to customers that handle money on behalf of their customers, in compliance with the FCA’s Client Asset Sourcebook (CASS). This can include investment firms, mortgage brokers and lenders, property management companies, pension scheme providers, and insurance companies. Client money accounts are also available to solicitors and accountants, which are regulated by their own industry authorities.
Client money accounts are used to keep your customer’s funds ringfenced from your own operational funds. This is a regulatory requirement for CASS firms. Your own funds should be held in separate operational accounts, and your client money accounts should only contain customer funds.
There are three types of client money account.
- General client money. Holds money belonging one or more clients, with no prerequisites. This is the most common form of client money account
- Designated client money. Holds money belonging one or more clients, but with explicit written agreement from the client to use a specific bank and bank account. This agreement is managed outside Griffin.
- Designated client fund. Holds money of one or more clients, with explicit written agreement from the clients to hold those funds together within that specific bank account, forming a client fund. This is agreement is managed outside Griffin.
All client money accounts behave the same way on our platform, but we provide a label so you know what kind of account you’re dealing with.
You can hold funds from each of your customers in dedicated safeguarding accounts, or hold all your customer’s funds in a single pooled safeguarding account.
Savings accounts
Easy access savings accounts
Easy access savings accounts allow you to embed a savings product into your own offering.
Your customers use these bank accounts to hold their money and earn interest. The funds can be withdrawn, in part or in full, by your customer at any time, and they are protected by the FSCS by up to £85,000 per customer.
Each of your customers will be the owner and beneficiary of their own unique account - this is what allows them to earn interest on their funds directly.
You should never use a customer’s savings account to store your organisation’s funds.