Dedicated vs pooled accounts

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Our dedicated and pooled models only apply to safeguarding accounts and client money accounts.

If you are holding and controlling customer funds in the UK, you are required to keep this money ringfenced in bank accounts that are completely separate from your operational and business expense accounts. We provide both safeguarding and client money accounts for this purpose.

Electronic Money Institutions (EMIs) and Payments Institutions (PIs) must use safeguarding accounts. Wealth managers, lenders, property management companies, and others are required to use client money accounts.

For both account types, we offer two different options depending on your needs: dedicated accounts and pooled accounts.

• Dedicated accounts let you open a distinct, named bank account for each customer. Each dedicated account is a real bank account with its own unique account number, meaning you can access the customer’s individual balance and transaction history via our API and UI.
• Pooled accounts are a single bank account used to hold money belonging to multiple customers. You will need to use your own technology to track their balances and transactions. You must also add your customers as members of the pooled account before their funds can be deposited and, to comply with regulatory requirements, the pooled account membership must be updated on a daily basis.

We’ll go into more detail on each option, but the table below compares the key features.

Feature	Dedicated accounts	Pooled accounts
Quick onboarding for your customers	Yes	Yes
Easy integration via API	Yes	Yes
Access accounts via UI	Yes	Yes
Unique account number per customer	Yes	No
Simplified reconciliation	Yes	No

Dedicated accounts

With dedicated accounts, you can open a safeguarding or client money bank account per customer. There are a number of advantages to this:

• Bank as a system-of-record. Dedicated accounts allow you to see exactly whose money is where in real-time, simplifying reconciliation for your team and making reporting quick and easy. To put it another way, dedicated accounts greatly reduce windows of error where your records are out-of-sync with the actual location of the funds.
• Less risk for you and your customer. Dedicated accounts give you more immediate visibility on individual customer activity, which makes it easier to detect and prevent financial crime.
• Unique account number and sort code combinations. This reduces payment errors, which means less manual back office work for your team and a better experience for your customer.

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Are dedicated accounts the same as virtual accounts?

Some banks offer virtual accounts, which are basically sub-accounts layered on top of one main pooled account. While this creates better visibility on flow-of-funds than a basic pooled account, virtual accounts still add another layer of complexity which can create risk and reconciliation problems. By contrast, our dedicated accounts are real bank accounts and they are not linked to any underlying pool. We do not offer virtual accounts for safeguarding or client money purposes.

Pooled accounts

Pooled accounts let you hold funds from multiple customers in a single safeguarding or client money account. This means you are responsible for tracking each customer’s activity and balance within the shared pool. This account type is suitable for established companies who have already invested in their own ledger technology and reconciliation solutions.

Managing pooled account members

Griffin does not track which funds in a pooled account belong to which customers: that responsibility falls to you. But broadly, we still need to know whose money is being held with us and understand the source of funds. This is part of our financial crime prevention standards and our regulatory obligations, specifically the Money Laundering Regulations 2017.

In practice, this means that when you open a pooled account:

• You will need to onboard your customers using either Verify or Reliance onboarding.
• Once your customers are onboarded, you will need to add them as a member of the pooled account. The account will not be able to receive payments until you have added at least one member.
• You will need to keep the membership up-to-date by adding or removing members.
• You must confirm that the membership is up-to-date at least once every 24 hours (this can be automated via the API).

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For more detail, see our guide on managing pooled account members.