Source of Funds (SoF) Verification

This page provides an overview of the key steps and requirements for verifying the source of funds for individuals and businesses.

Source of Funds (SoF) Guide

Occasionally, for large transactions and clients of higher risk profile, we may ask for Source of Funds (SoF). This guide will help you understand the SoF process, required official documents, and best practices so you can complete checks smoothly and efficiently.

1. Introduction

What is Source of Funds (SoF)?

Source of Funds (SoF) verification ensures that any money entering an account or being used for payments comes from legitimate, clearly documented, and lawful sources.

Why it matters:

Under FATF (Financial Action Task Force) standards and local anti-money laundering (AML) rules, verifying the origin of funds is required to:

  • Meet global compliance obligations

  • Prevent money laundering, terrorism financing, and fraud

  • Support safe access to financial products and services

  • Provide transparency and trust for all parties

2. Acceptable Sources of Funds & Examples of Documents

Here are common funding sources with examples of official documents used for verification:

A) Personal Savings or Employment Income

  • Examples: Salaries, bonuses, pensions, personal savings

  • Documents: Payslips, tax returns, employment contracts, bank statements

B) Business Revenues

  • Examples: Trade income, service contracts, freelance work

  • Documents: Invoices, signed contracts, bank statements showing client payments

C) Investments or Grants

  • Examples: Private investments, grants, scholarships

  • Documents: Investment agreements, grant letters, bank transfer receipts

D) Sales of Assets

  • Examples: Property sales, vehicle sales, valuable items

  • Documents: Sale agreements, title transfer documents, bank statements

E) Loans or Credit Lines

  • Examples: Bank loans, credit facilities

  • Documents: Loan agreements, proof of disbursement, lender details

F) Other Legitimate Sources

  • Examples: Inheritance, insurance payouts

  • Documents: Legal documents confirming inheritance, insurance claim settlements

3. Risk-Based Approach

We apply risk scoring based on:

  • Country or jurisdiction risk

  • Source of funds complexity

  • Amount and frequency of transactions

For higher-risk cases, additional documents may be required, such as:

  • Source of Wealth declarations

  • Audited financials or tax filings

  • Legal or regulatory approvals

4. Document Quality Requirements

To ensure smooth processing:

  • Submit official, clear documents in PDF or scan format

  • Ensure payer names, amounts, and dates match across all documents

  • Provide documents from the past 3-6 months where applicable

5. Tips for a Smooth SoF Process

  • Gather documents before sending or receiving funds

  • Double-check that all names and amounts match exactly

  • Use summaries if multiple sources of funds are involved

  • Ask for confirmation letters or attestations if needed

6. FAQs

Q: Why can’t I just send a news article or online post? A: Regulators require official evidence such as contracts, bank statements, or legal documents. Media reports, news articles, or social media posts are not accepted as proof.

Q: Do small transactions also need documents? A: No. Simplified checks may apply for low-risk payments & low-risk clients, but some documentation may still be required.

Q: Are my documents secure? A: Yes, all documents are handled in line with regulatory data protection requirements.

7. Support & Help

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