Almost every bank, EMI or payment provider review eventually asks: "where does the money come from?" This is where most applications get stuck — the owner knows the answer but cannot prove it the way compliance expects. Here are two concepts that are often confused and how to prepare for both. It is one of the core parts of our KYB/KYC support.
In short: source of funds is where the specific money you deposit or transfer comes from. Source of wealth is how the owner built their overall wealth. Both are proven with documents, not words.
The difference
| Source of funds | Source of wealth | |
|---|---|---|
| Question | Where does this specific amount come from? | How did the person accumulate their capital? |
| Example | €50,000 of share capital came from the owner's account | The owner ran an IT company for 10 years and sold a stake |
| Documents | Statements, contracts, payment orders | Income records, business sale agreement, dividends, inheritance |
| When asked | Almost always | For large amounts, high risk, politically exposed persons |
Which documents work
- Salary and bonuses: employment contract, payslips, statements showing deposits.
- Business income: dividend resolutions, company accounts, statements.
- Sale of a business or asset: sale agreement and proof of receipt of funds.
- Investments: brokerage statements, proof of withdrawal.
- Inheritance or gift: notarised documents and proof of transfer.
- Crypto: purchase and sale history, exchange statements and the path of funds to the bank account.
How to prepare the explanation
- Write a short story. One paragraph: how and when the money arose and which accounts it passed through.
- Match it to documents. Every statement needs evidence.
- Check the numbers. Amounts in the explanation, documents and application form must match.
- Show the path. If funds moved through several accounts, attach the chain of transfers.
- Translate if needed. Non-English documents often require translation.
Common mistakes
- "Personal savings" with no evidence at all.
- Cash deposited to an account with no explanation of its origin.
- Amounts in the explanation that do not match the statements.
- Crypto assets without acquisition history.
Frequently asked questions
What if I have no documents from past years?
Collect indirect evidence: tax returns, archived bank statements, accountant letters, public information about the business. The fuller the picture, the better.
Do I have to disclose my entire wealth?
Usually you need to explain the origin of capital to the extent needed to understand the risk. The depth depends on the amount and profile, but the information must be truthful and consistent.
Is this a one-time check?
No. Providers refresh client data periodically and may ask about large transactions.
Need to prove the origin of funds to a bank or payment provider? Send a request on the KYB/KYC support page and we will run a gap analysis, build a data room and agree the wording. The same pack helps with opening business accounts.