What is a Proof of Funds (POF) and Credit Enhancement (CE)?
What is a SWIFT MT799 confirmation?
What is a SWIFT MT760 confirmation?
What are the minimum and maximum amounts available?
How long can the account be kept open for Proof of Funds uses?
How is my Arrangement Fee protected?
Can I pay the Arrangement Fee after the account has been opened?
A POF is a show of money or asset used in order to initiate a transaction or complete underwriting requirements mandating the borrower have a minimum amount of reserves. It is often a term used in commodity transactions required to be shown prior to proof of product (POP) being evidenced. However, the term POF has grown common in many financial transactions and industries.
Credit Enhancement for our purposes is a method of using a cash account or instrument as a means of qualifying for financing or showing capability to engage in a fiancial transaction. While Wall Street uses CE for securitization of a transaction in structured finance, Balboa Trade intends to use the term more loosely using assets to "enhance" a party's position in financial transactions. When understood in this manner CE is not to be used for collateralization or securitization, but as a show of financial capacity.
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An account with the SWIFT MT799 capability allows bank-to-bank SWIFT electronic verification for Proof of Funds in the account, with no further comment. Normally, a SWIFT MT799 is used as a prelude to a follow-up SWIFT message such as an MT760 because they are both part of the Category 7 Documentary Credits and Guarantees SWIFT format category. There is a $10 million minimum account size for this SWIFT wire communication. Additional costs apply.
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An account with the SWIFT MT760 capability allows bank-to-bank SWIFT electronic verification of the account, and will include a blocked funds provision. There is no other bank guarantee provision available in the SWIFT instructions. $10 million minimum account size.
View MT760 Example
The minimum account size range from one million to ten million for most services.
We have 30, 60, 90 days and 12 month terms available. The account can be renewed for additional terms upon mutual agreement.
The Arrangement Fee is deposited in a Trust Account with a licensed and bonded third-party Escrow Agent of the provider's choice as agreed. The Fee is not released until the the account has been opened and you have had opportunity to personally verify and authenticate the account. In the unlikely event the account is not opened and able to be authenticated per the escrow agreement or service agreement, the Arrangement Fee is returned by the Escrow Agent.
No, the Arrangement Fee must be placed in an Escrow Trust Account before the Proof of Funds account is opened due to the significant costs incurred to open the account.