Not for Profit FX Compliance

Combined, Australia’s 54,000 registered charities have an annual income of over $142.8 billion and assets totalling $279 billion[1].

Australia’s ranks as the sixth most generous country in the world for charities operating overseas[2]. With nearly 10 percent of Australian charities working overseas the cost of moving money internationally is a major drain on the community’s giving. And while straight-forward for-profit businesses and individual customers have enjoyed the benefits of FX competition, the not-for-profit sector faces barriers to reducing FX costs.

Most international payment companies steer clear of the not-for-profit sector because of their corporate structures (usually Trusts) and countries where they operate (often high-risk money laundering locations). Feature that make compliance risk assessment of difficult. For FX money transfer businesses compliance is major investment where the risks are high. Not many can afford CBA’s $700 million fines for bad transaction reporting.

Charities can access lower cost FX providers by demonstrating their commitment to Anti Money Laundering compliance. My changing from traditional providers charities can improve the returns they achieve on the funds they deploy overseas.

Charities can demonstrate their commitment to Anti Money Laundering compliance by implementing a governance and control framework with features that include:

Company registration Demonstrates corporate capability and helps identification of Directors and Beneficial Owners.
ATO registration Demonstrates tax compliance.
Australian Charities and Not-for-profits Commission registration Enables FX providers to ensure they are dealing with legitimate NPOs as members publish financials, governance details, and names of Directors.
Australian Council for International Development Adhering to ACFIDs code of conduct demonstrates integrity, accountability, and transparency. The code is implemented through a Good Practice Toolkit.
Australian bank account in name of NPO Demonstrates acceptance of legitimacy by a deposit taking institution.

Source: AUSTRAC [3]

Most corporates in Australia accept as routine business registration activities. But because of the high AML risk countries many charities operate in, publicly demonstrating good governance helps them access a deeper pool of providers and increases competition for their business.

About AquireFX. AquireFX is an international money transfer business based in Melbourne. We offer wholesale FX rates and low transfer fees, giving our customers substantial savings when moving money internationally.

[1] Australian Charities and Not for Profit Commission, Australian Charities Report 2016

[2] CAF World Giving Index 2017

[3] Australia’s Non-Profit Organisation Sector National Risk Assessment 2017, Money Laundering / Terrorism Financing, AUSTRAC

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