top of page

How do I assess what a suitable outsourced service provider looks like from a due-diligence perspective?

For critical and important functions, Payment Institutions (<a href="/glossarycollection/payment-institution" style="color:#48277C;" target="_blank" title="Payment Institution"><u>PI</u></a>) should ensure that the service provider has the business reputation, appropriate and sufficient abilities, the expertise, the capacity, the resources (e.g. human, IT, financial), the organisational structure and, if applicable, the required regulatory authorisation(s) or registration(s) to perform the critical or important function in a reliable and professional manner to meet its obligations over the duration of the draft contract.<br/><br/>

Additional factors to be considered when conducting due diligence on a potential service provider include, but are not limited to:<br/><br/>

- its business model, nature, scale, complexity, financial situation, ownership and group structure;<br/><br/>

- the long-term relationships with service providers that have already been assessed and perform services for the PI;<br/><br/>

- whether the service provider is a parent undertaking or subsidiary of the PI, is part of the accounting scope of consolidation of the institution or is a member of or is owned by institutions that are members of the same institutional protection scheme to which the institution belongs;<br/><br/>

- whether or not the service provider is supervised by competent authorities.

bottom of page