{"id":6877,"date":"2026-10-20T12:50:00","date_gmt":"2026-10-20T09:50:00","guid":{"rendered":"https:\/\/legalbit.top\/en\/?p=6877"},"modified":"2026-10-23T15:51:49","modified_gmt":"2026-10-23T12:51:49","slug":"how-banks-block-fintech-startup-accounts","status":"publish","type":"post","link":"https:\/\/legalbit.top\/en\/how-banks-block-fintech-startup-accounts\/","title":{"rendered":"How Banks Block Fintech Startup Accounts and how to Avoid it"},"content":{"rendered":"\n<div class=\"lbm\"><svg width=\"0\" height=\"0\" style=\"position:absolute\" aria-hidden=\"true\"><symbol id=\"i-list\" viewBox=\"0 0 24 24\"><path d=\"M9 6h11M9 12h11M9 18h11\"\/><path d=\"M4 6h.01M4 12h.01M4 18h.01\"\/><\/symbol><symbol id=\"i-user\" viewBox=\"0 0 24 24\"><circle cx=\"12\" cy=\"8\" r=\"4\"\/><path d=\"M4 21c0-4 3.6-7 8-7s8 3 8 7\"\/><\/symbol><symbol id=\"i-ban\" viewBox=\"0 0 24 24\"><circle cx=\"12\" cy=\"12\" r=\"9\"\/><path d=\"M5.6 5.6l12.8 12.8\"\/><\/symbol><symbol id=\"i-layers\" viewBox=\"0 0 24 24\"><path d=\"M12 3l9 5-9 5-9-5z\"\/><path d=\"M3 13l9 5 9-5\"\/><\/symbol><symbol id=\"i-eye\" viewBox=\"0 0 24 24\"><path d=\"M2 12s4-7 10-7 10 7 10 7-4 7-10 7S2 12 2 12z\"\/><circle cx=\"12\" cy=\"12\" r=\"3\"\/><\/symbol><symbol id=\"i-doc\" viewBox=\"0 0 24 24\"><path d=\"M7 3h8l4 4v14H7z\"\/><path d=\"M15 3v4h4M10 12h6M10 16h6\"\/><\/symbol><symbol id=\"i-pen\" viewBox=\"0 0 24 24\"><path d=\"M4 20l4-1 11-11-3-3L5 16z\"\/><path d=\"M14 6l3 3\"\/><\/symbol><symbol id=\"i-book\" viewBox=\"0 0 24 24\"><path d=\"M4 5a2 2 0 0 1 2-2h13v16H6a2 2 0 0 0-2 2z\"\/><path d=\"M4 19V5\"\/><\/symbol><symbol id=\"i-alert\" viewBox=\"0 0 24 24\"><path d=\"M12 3l10 18H2z\"\/><path d=\"M12 10v4M12 17.5h.01\"\/><\/symbol><symbol id=\"i-bulb\" viewBox=\"0 0 24 24\"><path d=\"M9 18h6M10 21h4\"\/><path d=\"M12 3a6 6 0 0 0-3.5 10.9c.6.5 1 1.2 1 2.1h5c0-.9.4-1.6 1-2.1A6 6 0 0 0 12 3z\"\/><\/symbol><symbol id=\"i-info\" viewBox=\"0 0 24 24\"><circle cx=\"12\" cy=\"12\" r=\"9\"\/><path d=\"M12 11v5M12 8h.01\"\/><\/symbol><\/svg><section class=\"lbm-intro\"><div class=\"lbm-intro-main\"><p class=\"lbm-lead\">Banks block fintech startup accounts when the money-laundering, sanctions or reputational risk of a customer outweighs its value. There are almost always signals before a block, and most cases can be prevented. We go through why banks block accounts, which actions trigger it and what to do in advance to keep an account stable.<\/p><p class=\"lbm-verified\">Checked on 21 October 2026. Rules and sources are current as of this date.<\/p><ul class=\"lbm-toc\"><li><a href=\"#why\">Why it happens<\/a><\/li><li><a href=\"#trig\">Triggers<\/a><\/li><li><a href=\"#steps\">How to avoid it<\/a><\/li><li><a href=\"#case\">Case analysis<\/a><\/li><li><a href=\"#now\">If already blocked<\/a><\/li><li><a href=\"#chk\">Checklist<\/a><\/li><li><a href=\"#faq\">FAQ<\/a><\/li><\/ul><\/div><\/section><section id=\"why\"><h2>Why banks block fintech startup accounts<\/h2><div class=\"lbm-cols\"><p>The professional term is <b>de-risking<\/b>: a bank refuses a customer, or a whole category of customers, it considers risky for money laundering. The European Banking Authority (EBA) in its 2022 opinion names typical reasons: risk above the bank\u2019s appetite, lack of expertise to assess the business model, or compliance costs that exceed the expected profit.<\/p><p>Many refusals follow from a formal rule: if the bank cannot complete customer due diligence (CDD), it must not carry out the transaction and must end the relationship (Art. 14(4) of Directive (EU) 2015\/849). From 10 July 2027 this rule will be replaced by Regulation (EU) 2024\/1624 (AMLR).<\/p><\/div><div class=\"lbm-co dark\"><span class=\"lbm-ico\"><svg><use href=\"#i-alert\"\/><\/svg><\/span><div><b>Tipping-off<\/b><p>The law forbids a bank to tell a customer about a review or a suspicious transaction report (Art. 39 of Directive 2015\/849). That is why notices sound vague.<\/p><\/div><\/div><\/section><section id=\"trig\"><h2>6 main triggers of a block<\/h2><div class=\"lbm-roles\"><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-layers\"\/><\/svg><\/span><h3>Opaque ownership and source of funds<\/h3><p>A chain of holdings with no clear beneficial owner and no proof of where the money comes from. On structuring, see our article on <a href=\"\/en\/how-to-choose-a-jurisdiction-for-your-company-registration\/\">choosing a jurisdiction for your company<\/a>.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-ban\"\/><\/svg><\/span><h3>High-risk niche and geography<\/h3><p>Crypto, iGaming, payments, traffic arbitrage, as well as users and counterparties from sanctioned jurisdictions.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-eye\"\/><\/svg><\/span><h3>Activity does not match what was declared<\/h3><p>You described SaaS, but the account shows third-party payments, split payments, pass-through flows or a sudden jump in turnover. More on <a href=\"\/en\/transaction-laundering-and-miscoding\/\">transaction laundering and miscoding<\/a>.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-doc\"\/><\/svg><\/span><h3>Weak AML\/KYB, no licence<\/h3><p>Policies exist only on paper, no monitoring, counterparties unchecked, compliance run by a part-timer. For the types of licences, see <a href=\"\/en\/regulatory-and-compliance\/\">Licensing, compliance and AML\/KYC<\/a>.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-list\"\/><\/svg><\/span><h3>Weak finances<\/h3><p>No revenue and a short runway: the bank doubts you can sustain compliance procedures.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-pen\"\/><\/svg><\/span><h3>Silence in response to requests<\/h3><p>A late or incomplete answer to a request for information (RFI) is by itself grounds to restrict the account.<\/p><\/div><\/div><div class=\"lbm-co dark\"><span class=\"lbm-ico\"><svg><use href=\"#i-alert\"\/><\/svg><\/span><div><b>Example: JPMorgan and stablecoin startups<\/b><p>According to The Information (December 2025), JPMorgan had closed or frozen the accounts of BlindPay and Kontigo, stablecoin startups working in Latin America through the payments provider Checkbook. The bank reportedly flagged activity linked to Venezuela and other US-sanctioned locations; Checkbook\u2019s CEO tied the closures to a surge in chargebacks, and a bank spokesperson said it was not about stablecoins. The bank has not officially disclosed the details. The takeaway: the bank assesses not the \u201clegality\u201d of the product but its own exposure to the regulator.<\/p><\/div><\/div><\/section><section id=\"steps\"><h2>How to avoid a block: 6 steps<\/h2><ol class=\"lbm-steps\"><li><span class=\"lbm-ico\"><svg><use href=\"#i-layers\"\/><\/svg><\/span><div><h3>Choose a bank for your model<\/h3><p>Ask in advance whether it works with your niche and which documents, volumes and jurisdictions are acceptable.<\/p><span class=\"lbm-tag\">Start here<\/span><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-doc\"\/><\/svg><\/span><div><h3>Prepare a full onboarding package<\/h3><p>Business model and money-flow diagram, ownership structure with beneficial owners, source of funds, licences, AML\/KYC policy, counterparty checks (KYB) and a geography map.<\/p><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-eye\"\/><\/svg><\/span><div><h3>Declare your volumes and stick to them<\/h3><p>A serious deviation from the profile is a classic trigger. Warn the bank in advance about growth, a new jurisdiction or a change of beneficiaries.<\/p><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-list\"\/><\/svg><\/span><div><h3>Keep at least two accounts<\/h3><p>With different providers, for example a bank and a payment institution (EMI\/PSP): one block should not stop the business.<\/p><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-user\"\/><\/svg><\/span><div><h3>Build your own AML\/KYC control<\/h3><p>A policy, customer identification, transaction monitoring and a responsible officer. The bank needs to see that you manage the risk.<\/p><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-pen\"\/><\/svg><\/span><div><h3>Answer requests fast and in writing<\/h3><p>Appoint someone to handle the bank and attach a short explanation to every answer.<\/p><\/div><\/li><\/ol><div class=\"lbm-co soft\"><span class=\"lbm-ico\"><svg><use href=\"#i-bulb\"\/><\/svg><\/span><div><b>Tip<\/b><p>It is best to sort out structure and licensing before launch. We help under <a href=\"\/en\/corporate-law\/\">Company structure<\/a> and <a href=\"\/en\/fintech-payments-legal\/\">legal support for fintech and payment services<\/a>.<\/p><\/div><\/div><\/section><div class=\"lbm-svc\"><div><b>Need help with this topic?<\/b><p>We will review your situation and propose a solution for your project.<\/p><\/div><a class=\"lbm-svc-btn popmake-4929\" href=\"#\" role=\"button\">Contact us<\/a><\/div><section id=\"case\"><h2>Case analysis<\/h2><div class=\"lbm-co soft\"><span class=\"lbm-ico\"><svg><use href=\"#i-bulb\"\/><\/svg><\/span><div><b>Hypothetical example, not a real case<\/b><p>A fintech startup receives a bank notice that its account will be closed in 30 days with no reason given. A sensible order of action is to ask at once for the reasons in writing, assemble and send a package of documents on the business, the sources of funds and counterparties, open a backup account at another bank in parallel, and prepare to move payments so that settlements are not lost.<\/p><\/div><\/div><\/section><section id=\"now\"><h2>If your account is already blocked<\/h2><ol class=\"lbm-steps\"><li><span class=\"lbm-ico\"><svg><use href=\"#i-pen\"\/><\/svg><\/span><div><h3>Do not ignore the bank\u2019s requests<\/h3><p>A late answer itself becomes grounds for restrictions. Reply on time and in writing.<\/p><span class=\"lbm-tag must\">Urgent<\/span><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-eye\"\/><\/svg><\/span><div><h3>Find out the nature of the restriction<\/h3><p>Sanctions screening, internal assessment, automated monitoring or a data error: the strategy depends on it. Ask in writing which documents are needed.<\/p><\/div><\/li><li><span class=\"lbm-ico\"><svg><use href=\"#i-user\"\/><\/svg><\/span><div><h3>Bring in a lawyer<\/h3><p>A letter from a law firm is read differently by a compliance team than a founder\u2019s emails, and the dialogue moves faster.<\/p><\/div><\/li><\/ol><\/section><figure class=\"lbm-pull\"><q>The bank assesses not the \u201clegality\u201d of your product but its own exposure to the regulator.<\/q><cite>The LegalBit team<\/cite><\/figure><section id=\"chk\"><h2>Checklist: is your account safe<\/h2><div class=\"lbm-roles\"><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-doc\"\/><\/svg><\/span><h3>Documents and structure<\/h3><p>The bank knows your model and agrees with it. Beneficial owners and ownership chain documented. Source of funds confirmed. You have a licence or a rationale for none. Financial statements and runway available. At least two accounts with different providers.<\/p><\/div><div class=\"lbm-role\"><span class=\"lbm-ico\"><svg><use href=\"#i-eye\"\/><\/svg><\/span><h3>Operations and control<\/h3><p>AML\/KYC policy and transaction monitoring in place. KYB procedure for counterparties. Map of geographic exposure prepared. Someone is responsible for the bank relationship. Turnover matches the declared profile. The bank is warned of changes.<\/p><\/div><\/div><\/section><section id=\"faq\"><h2>Frequently asked questions<\/h2><div class=\"lbm-faq\"><details><summary>Why did my bank block my account without explaining why?<\/summary><p>Anti-money laundering rules prohibit a bank from telling a customer that a review is under way or that a suspicious activity report has been filed (known as tipping-off). That is why notices are often generic: \u201cadditional review required\u201d or \u201cchange in bank policy\u201d. You can still ask in writing: the bank may not state the reason, but it will usually tell you which documents and information it needs to lift the restrictions.<\/p><\/details><details><summary>Can a bank close a fintech company\u2019s account without giving a reason?<\/summary><p>Usually the account terms allow the bank to terminate with prior notice, so it is not always obliged to explain. In the EU, however, payment institutions are entitled to access to accounts on an objective, non-discriminatory and proportionate basis (PSD2 Article 36), and a bank must give the supervisor duly motivated reasons for rejecting a payment institution. The EBA treats blanket refusals of whole customer categories as a sign of ineffective risk management. Your actual rights depend on the jurisdiction and your contract.<\/p><\/details><details><summary>How long does the review take before a block is lifted?<\/summary><p>It depends on the bank and the complexity of your structure: from a few days if your documents are in order and prepared in advance, to several weeks or months if the bank asks for more detail on the ownership chain and the source of funds. The more complete your first package, the shorter the review.<\/p><\/details><details><summary>What bank should a fintech startup choose?<\/summary><p>One that understands your model and already works with companies in your niche, not simply the cheapest. Ask the bank directly whether it accepts customers in your category, which licences and documents it needs, and which turnover and jurisdictions are acceptable. Do not build your operations on a single account: keep at least two with different providers.<\/p><\/details><details><summary>Can a lawyer help if my account is already blocked?<\/summary><p>Yes. A lawyer can prepare the document package and the business-model explanation, respond to the bank\u2019s requests, assess whether your contractual and regulatory rights have been breached, and set up the structure so that the block does not recur. The earlier you involve one, the better: some contractual deadlines are short.<\/p><\/details><\/div><p class=\"lbm-more\"><b>See also: <\/b><a href=\"\/en\/transaction-laundering-and-miscoding\/\">Transaction Laundering and Miscoding: The Hidden Threats to Your Fintech Business<\/a>; <a href=\"\/en\/what-is-know-your-customer-kyc-and-why-is-it-essential-for-cryptocurrency-exchanges\/\">What is Know Your Customer (KYC) and why is it essential for cryptocurrency exchanges?<\/a>; <a href=\"\/en\/payment-institution-emi-licence-eu-uk-canada\/\">EMI and Payment Institution Licence in the EU, UK and Canada<\/a>; <a href=\"\/en\/accepting-crypto-payments-business\/\">Accepting crypto payments in business<\/a>. Services: <a href=\"\/en\/fintech-payments-legal\/\">legal services for fintech and payments<\/a>.<\/p><div class=\"lbm-src\"><b>Sources<\/b><ul><li><a href=\"https:\/\/www.eba.europa.eu\/sites\/default\/files\/document_library\/Publications\/Opinions\/2022\/Opinion%20on%20de-risking%20(EBA-Op-2022-01)\/1025705\/EBA%20Opinion%20and%20annexed%20report%20on%20de-risking.pdf\" rel=\"nofollow noopener\" target=\"_blank\">EBA: Opinion on de-risking (EBA\/Op\/2022\/01)<\/a><\/li><li><a href=\"https:\/\/www.eba.europa.eu\/publications-and-media\/press-releases\/eba-issues-guidelines-challenge-unwarranted-de-risking-and\" rel=\"nofollow noopener\" target=\"_blank\">EBA: Guidelines on ML\/TF risk management and access to financial services (EBA\/GL\/2023\/04)<\/a><\/li><li><a href=\"https:\/\/eur-lex.europa.eu\/eli\/dir\/2015\/849\/oj\" rel=\"nofollow noopener\" target=\"_blank\">EUR-Lex: Directive (EU) 2015\/849 (AMLD)<\/a><\/li><li><a href=\"https:\/\/eur-lex.europa.eu\/eli\/dir\/2015\/2366\/oj\" rel=\"nofollow noopener\" target=\"_blank\">EUR-Lex: Directive (EU) 2015\/2366 (PSD2)<\/a><\/li><li><a href=\"https:\/\/cointelegraph.com\/news\/jpmorgan-freezes-stablecoin-startup-accounts-sanctions\" rel=\"nofollow noopener\" target=\"_blank\">Cointelegraph (citing The Information): JPMorgan freezes stablecoin startup accounts<\/a><\/li><\/ul><\/div><\/section><\/div>\n\n\n\n<div class=\"lb-ac\"><h2>This is what we do<\/h2><p>How we help projects with this topic:<\/p><ul><li><a href=\"\/en\/regulatory-and-compliance\/\">Licensing, compliance and AML\/KYC<\/a><\/li><li><a href=\"\/en\/fintech-payments-legal\/\">Lawyers for fintech and payment services<\/a><\/li><\/ul><\/div>\n\n\n\n<script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\",\"@type\":\"BlogPosting\",\"headline\":\"How banks block fintech startup accounts and how to avoid it\",\"description\":\"Why banks block fintech company accounts, what triggers it and how to protect your account: 6 steps, a checklist and what to do if you have already been blocked.\",\"url\":\"https:\/\/legalbit.top\/en\/how-banks-block-fintech-startup-accounts\/\",\"mainEntityOfPage\":\"https:\/\/legalbit.top\/en\/how-banks-block-fintech-startup-accounts\/\",\"datePublished\":\"2026-10-19T00:00:00Z\",\"dateModified\":\"2026-10-19T00:00:00Z\",\"inLanguage\":\"en\",\"author\":{\"@type\":\"Organization\",\"name\":\"LegalBit\",\"url\":\"https:\/\/legalbit.top\/\"},\"publisher\":{\"@type\":\"Organization\",\"name\":\"LegalBit\",\"url\":\"https:\/\/legalbit.top\/\"}}<\/script>\n<script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\",\"@type\":\"FAQPage\",\"mainEntity\":[{\"@type\":\"Question\",\"name\":\"Why did my bank block my account without explaining why?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Anti-money laundering rules prohibit a bank from telling a customer that a review is under way or that a suspicious activity report has been filed (known as tipping-off). That is why notices are often generic: \u201cadditional review required\u201d or \u201cchange in bank policy\u201d. You can still ask in writing: the bank may not state the reason, but it will usually tell you which documents and information it needs to lift the restrictions.\"}},{\"@type\":\"Question\",\"name\":\"Can a bank close a fintech company\u2019s account without giving a reason?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Usually the account terms allow the bank to terminate with prior notice, so it is not always obliged to explain. In the EU, however, payment institutions are entitled to access to accounts on an objective, non-discriminatory and proportionate basis (PSD2 Article 36), and a bank must give the supervisor duly motivated reasons for rejecting a payment institution. The EBA treats blanket refusals of whole customer categories as a sign of ineffective risk management. Your actual rights depend on the jurisdiction and your contract.\"}},{\"@type\":\"Question\",\"name\":\"How long does the review take before a block is lifted?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"It depends on the bank and the complexity of your structure: from a few days if your documents are in order and prepared in advance, to several weeks or months if the bank asks for more detail on the ownership chain and the source of funds. The more complete your first package, the shorter the review.\"}},{\"@type\":\"Question\",\"name\":\"What bank should a fintech startup choose?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"One that understands your model and already works with companies in your niche, not simply the cheapest. Ask the bank directly whether it accepts customers in your category, which licences and documents it needs, and which turnover and jurisdictions are acceptable. Do not build your operations on a single account: keep at least two with different providers.\"}},{\"@type\":\"Question\",\"name\":\"Can a lawyer help if my account is already blocked?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Yes. A lawyer can prepare the document package and the business-model explanation, respond to the bank\u2019s requests, assess whether your contractual and regulatory rights have been breached, and set up the structure so that the block does not recur. The earlier you involve one, the better: some contractual deadlines are short.\"}}]}<\/script>\n","protected":false},"excerpt":{"rendered":"<p>Why banks block fintech accounts, which actions trigger it and what to do in advance to keep your account stable.<\/p>\n","protected":false},"author":1,"featured_media":6902,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[72],"tags":[128,115,120,117],"post_folder":[],"class_list":["post-6877","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fintech","tag-banking","tag-compliance","tag-fintech","tag-payments"],"_links":{"self":[{"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/posts\/6877","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/comments?post=6877"}],"version-history":[{"count":40,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/posts\/6877\/revisions"}],"predecessor-version":[{"id":8104,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/posts\/6877\/revisions\/8104"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/media\/6902"}],"wp:attachment":[{"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/media?parent=6877"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/categories?post=6877"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/tags?post=6877"},{"taxonomy":"post_folder","embeddable":true,"href":"https:\/\/legalbit.top\/en\/wp-json\/wp\/v2\/post_folder?post=6877"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}