Source of funds
Origin of specific money in a specific transaction: where the funds credited to the account came from, what the transaction amount is based on, and what documents confirm this.
Practical significance
This is the most common question banks ask about a large transaction. The answer "from the sale of a business" without documents is not an answer: a verifiable chain from the transaction to the receipt of funds is required. Preparing such a chain in advance saves weeks of correspondence.
Where it is used
- account opening and large transfers
- real estate transactions
- investments in regulated jurisdictions
- KYC and EDD procedures
What the term does not mean
Not the same as the general history of wealth. This concerns specifically the money involved in this transaction, not capital as a whole.
How it differs from «Source of wealth»
Source of funds - where this particular money came from. Source of wealth - how the fortune was formed overall. Banks ask about both and will not accept an answer to one in place of the other. More about this term
Illustrative example
The funds for the real estate purchase came from the sale of a stake in the company: confirmed by the sale agreement, the corporate record of the change in membership, and the bank statement showing receipt of funds.
Related terms, services and guides
Definition verified 3 August 2026
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