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Banking as a Service

Banking as a Service (BaaS) is a business model where a bank or other financial institution provides banking services and infrastructure to non-financial client organizations (such as retailers and utility companies). BaaS enables you to embed financial products into your services without having to launch your own financial institution and having to deal with the laws and regulations that would entail.

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Note that Pismo is not a licensed bank and does not directly implement a BaaS. Instead, it provides a cloud-based technology platform that enables our clients, in collaboration with Pismo’s BaaS partners (such as BTG, Celcoin, Itaú, and JD Consultores) to offer banking services.

With Pismo technology and a partnering BaaS provider, you can:

  • Set up your organization, programs, and customer accounts with Pismo.
  • Implement Pix instant payments (Brazil).
  • Pay bank slips (Brazil) - Bank slips are also known as boletos in Brazil.
  • Execute P2P - Pismo account to Pismo account transactions.
  • Perform Cash-out transfers to external accounts.
  • Other services depending on what your provider allows and supports.

Pismo technology benefits include:

  • Easy regulatory compliance.

  • Account management, monitoring, and reporting.

  • Transaction validations, including anti-fraud checks and Know Your Customer (KYC). See About KYC for more information.

Getting started

To use the services of a BaaS, follow these steps:

Step 1 - Partner with a provider

Set up a relationship with one of the payment service providers (PSP) Pismo works with and that are licensed in their respective countries or regions to provide BaaS services. These include Pay2All - a payment institution BTG Pactual created, and Celcoin. Your Pismo representative can help you get set up with a PSP.

Step 2 - Register your provider relationship with Pismo

Call the Create provider credential endpoint to register your provider relationship with Pismo.

Step 3 - Set up event notifications

Set up data and reporting to receive notifications (events) about Pismo account/customer setup and transaction success/failure.

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Event delivery

BaaS clients receive the same events as regular clients. Your provider does not receive any events unless you are working with Pay2All. In that case, both you and Pay2All receive all events.

Step 4 - Set up your org/programs/accounts/customers

Set up your organization, programs, accounts and customers with Pismo. Work with a Pismo representative to set up your organization. Once you do that, you can use the API to Create accounts and Create customers.

For more information, refer to Core objects. Also, check out Pismo Control Center which enables you to do a lot of your setup through a convenient UI.

Step 5 - Use the Pismo API to complete your configuration

The following endpoints are associated with BaaS:

About KYC

Know Your Customer (KYC) is a process that financial institutions and other businesses use to verify the identity of their customers. In the context of transactions, KYC is crucial for preventing fraud, money laundering, and other illicit activities.

The following is a brief overview of how KYC works in transactions:

  1. Documentation - Customers are required to provide certain documents to establish their identity. This may include government-issued photo identification (such as a driver's license or passport), proof of address (like a utility bill or bank statement), and, in some cases, additional information depending on the jurisdiction and the financial institution's requirements.

  2. Verification - The financial institution verifies the submitted documents to ensure that they are legitimate and belong to the individual seeking the credit card.

  3. Customer information - Financial institutions collect and maintain detailed information about their customers. This includes personal information, contact details, and transaction history. Keeping accurate and up-to-date records helps in monitoring and managing risks associated with credit card transactions.

  4. Risk assessment - KYC is an essential component of risk management for financial institutions. By understanding their customers, institutions can assess the level of risk associated with each customer and transaction. Unusual or suspicious activity can be flagged for further investigation.

  5. Compliance with regulations - KYC is often mandated by regulatory authorities to ensure that financial institutions are taking appropriate measures to combat fraud and money laundering. Institutions must adhere to specific guidelines and regulations set by the relevant authorities

In credit card transactions, KYC helps protect both the customer and the financial institution. It minimizes the chances of identity theft, unauthorized transactions, and other fraudulent activities. It also plays a crucial role in regulatory compliance, promoting a more secure and transparent financial system.

Updated 18 minutes ago