ZEN Corporate Account Rejection for VASP - Advice and Next Steps?

[IbnAlKhattab]

Hello everyone,

I recently faced an issue while trying to open a corporate (trader) account with ZEN for my newly registered VASP based in the Czech Republic. I want to do P2P trading and ZEN supports that.

Despite my efforts, the application was rejected by their compliance team without a detailed explanation.

Here are some possible reasons I suspect for the rejection:

1. Newly Registered Company: My company is just a few weeks old.
2. No website: Initially, we didn't have a website, privacy policy, T&Cs, or contact page, but these are now set up.
3. Inactive Social Media: Our social media accounts were set up but had no posts at the time of application.
4. KYC Systems: At the time of applying, we hadn't fully set up our KYC systems.
5. Risk Appetite: I might have provided answers that didn't align with their risk criteria, but without knowing their expectations, it's hard to say.

I’ve addressed points 2, 3, and 4, but obviously, I can’t change the fact that we are a new company, and I’m not sure what specific responses they are looking for regarding their risk appetite.

My questions for the community are:

• Why do you think ZEN might have rejected my application?
• Is it possible to reapply, and if so, what should I do differently?
• Does anyone here have experience with ZEN or similar institutions? I'm looking for recommendations for trusted service providers who specialize in handling high-risk accounts like those for crypto P2P merchants.

Any insights or advice would be greatly appreciated!

Thanks in advance!

 

[Forester]

ere are some possible reasons I suspect for the rejection:

1. Newly Registered Company: My company is just a few weeks old.
2. No website: Initially, we didn't have a website, privacy policy, T&Cs, or contact page, but these are now set up.
3. Inactive Social Media: Our social media accounts were set up but had no posts at the time of application.
4. KYC Systems: At the time of applying, we hadn't fully set up our KYC systems.

2-4 are more than enough to be rejected; but I'll add some more points:

What is the company's director(s) and UBO(s) residence and citizenship?
If different from the Czech Republic, how you have explained the reason for incorporating just in CZ and applying just for Zen?

Risk Appetite: I might have provided answers that didn't align with their risk criteria, but without knowing their expectations, it's hard to say.

Without knowing the questions and answers, it is impossible to comment

My questions for the community are:

• Why do you think ZEN might have rejected my application?

See above.

• Is it possible to reapply,

In theory, yes – but I do not much recommend to do it. You apparently have created a quite bad record for you (sorry but it was really unwise to apply having flaws like /2/ and especially /4/, the chances for onboarding were literally zero) and it is IMO remarkably better to begin from the scratch – with another provider or another company (i.e., create a new one).

• and if so, what should I do differently?

See above...

• Does anyone here have experience with ZEN or similar institutions?

I have but frankly, not with accounts for crypto P2P merchants. I am only well aware that P2P is really a problem for the majority of financial institutions...

 

[IbnAlKhattab]

2-4 are more than enough to be rejected; but I'll ad some more points:

What is the company's director(s) and UBO(s) residence and citizenship?
If different from the Czech Republic, how you have explained the reason for incorporating just in CZ and applying just for Zen?

Without knowing the questions and answers, it is impossible to comment



See above.

In theory, yes – but I do not much recommend to do it. You apparently have created a quite bad record for you (sorry but it was really unwise to apply having flaws like /2/ and especially /4/, the chances for onboarding were literally zero) and it is IMO remarkably better to begin from the scratch – with another provider or another company (i.e., create a new one).

See above...

I have but frankly, not with accounts for crypto P2P merchants. I am only well aware that P2P is really a problem for the majority of financial institutions...

Thanks for replying so quickly.

Yes my citizenship is different from the Czech Republic. Can’t really do anything about that.

As for reapplying, I really have nothing to lose at this point, so I might as well just do it.

Really dumb mistake on my part not setting up 2-4. Is there anything else I should keep in mind?

 

[Sols]

Do you have a team and office in CZ? Substance is important.

Are you MiCA and travel rule compliant?

Do you have a good MLRO and compliance framework in place?

When Zen says no, they are rarely open to revisiting the decision, at least until there have been some drastic improvements.

 

[Forester]

Thanks for replying so quickly.

You are welcome.

Yes my citizenship is different from the Czech Republic. Can’t really do anything about that.

Sure; you can hardly do anything re: this at this moment.
The background of my question is that some countries are considered ”toxic“ by Zen and your chances to be onboarded in such a case are close to zero regardless of anything else.
So, if you share the company's director(s) and UBO(s) current residence and citizenship, I (or someone else here, my knowledge is far from being complete) can be able to tell you whether it makes sense at all to apply or whether you would just waste your time and energy...

When Zen says no, they are rarely open to revisiting the decision, at least until there have been some drastic improvements.

Yes, I can confirm this. (It was the background of my recommendation.)

 

[IbnAlKhattab]

You are welcome.

Sure; you can hardly do anything re: this at this moment.
The background of my question is that some countries are considered ”toxic“ by Zen and your chances to be onboarded in such a case are close to zero regardless of anything else.
So, if you share the company's director(s) and UBO(s) current residence and citizenship, I (or someone else here, my knowledge is far from being complete) can be able to tell you whether it makes sense at all to apply or whether you would just waste your time and energy...


Yes, I can confirm this. (It was the background of my recommendation.)

It’s only me in the company. I have a Turkish citizenship.

 

[Sols]

It’s only me in the company. I have a Turkish citizenship.

Then this is another factor:

Jurisdictions under Increased Monitoring - 23 February 2024

Jurisdictions under increased monitoring are actively working with the FATF to address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing. Two additional countries, Kenya and Namibia, are now also subject to increased...

www.fatf-gafi.org

Especially if you also live in Turkey, and if the Czech company is basically just a shell company with no real substance.

 

[Forester]

It’s only me in the company. I have a Turkish citizenship.

Well, you have not shared your residency country; but regardless of this: regrattably, Zen does not welcome (or at least did not welcome) applicants/directors with Turkish citizenship. Tested repeatedly.
You can check the situation by trying to apply for a personal account; generally it's quite easy with Zen and the procedure is uncomplicated. If you succeed, it means that they have changed their policy at least a bit and you can go on; if not, do not waste your energy and search for another provider.
I am sorry that I cannot convey to you any more positive news

 

[IbnAlKhattab]

Well, you have not shared your residency country; but regardless of this: regrattably, Zen does not welcome (or at least did not welcome) applicants/directors with Turkish citizenship. Tested repeatedly.
You can check the situation by trying to apply for a personal account; generally it's quite easy with Zen and the procedure is uncomplicated. If you succeed, it means that they have changed their policy at least a bit and you can go on; if not, do not waste your energy and search for another provider.
I am sorry that I cannot convey to you any more positive news

Thanks for all your help nonetheless, really valuable info

 

[ilke]

I think @Sols summed this up in a great way.

One thing I will say is that Zen is near the easiest option for VASPs. So a rejection with them sets a bad precedent/expections for your future applications.

An important question to ask is whether you, as the only corporate member, have financial experience. An EMI or bank will definitely not want a VASP that has no employees skilled for AML.

I cannot confirm if, as @Forester said, Turkish citizens are not welcome at Zen. I know that they are friendly to most jurisdictions but they can be a bit picky sometimes. I have spoken to somebody with Egyptian citizenship and residency + Czech VASP and they didn't have an issue getting onboarded to Zen - although obviously had functional KYC, employed a local MLRO compliance officer in CZ and were able to answer questions about the project.

MiCA does not yet apply in CZ or LT but the places are getting ready for it, and EMIs might be getting stricter with VASPs that seem unready to comply with the new regulations (which are not at all friendly, but everyone has to comply nevertheless).

If your KYC and AML systems, FAÚ reporting, internal policies and internal audit systems are prepared, try another friendly EMI like PayDo or Collect&Pay - see if you get accepted there. I would not reapply to Zen so quickly, it could be suspicious to them and I would not expect so much success. You would also be better off not mentioning P2P - as a company listed on P2P like Binance, you will still have to be doing KYC and AML on your clients and effectively performing classic crypto exchanging, just on another platform.

 

[CyprusLawyer101]

Try going through an approved intermediary. The process is quite diffetent. It may be a matter of a few email exchanges and a few calls for the intermediary to clarify all your quedtions and whether there is possibility to get an approval.

 

[Forester]

Try going through an approved intermediary. The process is quite diffetent. It may be a matter of a few email exchanges and a few calls for the intermediary to clarify all your quedtions and whether there is possibility to get an approval.

Does Zen use intermediaries? Maybe for this specific client niche yes, I do not know; just generally I am not aware of it (at least not on the regular basis).
(But my knowledge is far from being complete )

Or are you speaking not about Zen but generally? From the general point of view / as a general methodology you are of course completely right.

 

[CyprusLawyer101]

Does Zen use intermediaries? Maybe for this specific client niche yes, I do not know; just generally I am not aware of it (at least not on the regular basis).
(But my knowledge is far from being complete )

Or are you speaking not about Zen but generally? From the general point of view / as a general methodology you are of course completely right.

I am speaking about Zen in particular. There is an approved intermediary scheme. If I am not mistaken, it only applies for corporate accounts. We have done a few.

 

[Roku]

H

I am speaking about Zen in particular. There is an approved intermediary scheme. If I am not mistaken, it only applies for corporate accounts. We have done a few.

How can I contact you?

 

[EliasIT]

Zen is a big time waste if you ask me, even the most simple business which they don't understand they reject. Wise and Revolut approved business for years!

 

[12345]

ZEN Business rejects nearly everyone, they rejected me and all my friends, our business sector is not high risk, we applied as european companies

 

[Forester]

Zen is a big time waste if you ask me, even the most simple business which they don't understand they reject.

ZEN Business rejects nearly everyone, they rejected me and all my friends, our business sector is not high risk, we applied as european companies

Well... I witnessed opening accounts with Zen 4-5 times in the last couple of months. It is true that there are some moments during the process when you must think carefully (or know ) what they want to read and what you should do; but if you are able, I do not see it as an unresolvable problem – on the contrary. In one case I advised my friend not even to try, as it seemed to me as a waste of time; but otherwise, success rate 100%...
That's why I believe @CyprusLawyer101 here ZEN Corporate Account Rejection for VASP - Advice and Next Steps? – if someone knowledgeable is helping you, you are playing another game.

Wise and Revolut approved business for years!

Well – if you possess some specific knowledge how to make them long-time happy, then it really can work for you AND you are a lucky man AND I look at you with a deep respect

 

[Roku]

Well... I witnessed opening accounts with Zen 4-5 times in the last couple of months. It is true that there are some moments during the process when you must think carefully (or know ) what they want to read and what you should do; but if you are able, I do not see it as an unresolvable problem – on the contrary. In one case I advised my friend not even to try, as it seemed to me as a waste of time; but otherwise, success rate 100%...
That's why I believe @CyprusLawyer101 here ZEN Corporate Account Rejection for VASP - Advice and Next Steps? – if someone knowledgeable is helping you, you are playing another game.



Well – if you possess some specific knowledge how to make them long-time happy, then it really can work for you AND you are a lucky man AND I look at you with a deep respect

Can you share some insights how to get approved to Zen business with VASP license as a crypto exchange?
PM me if possible

 

[Forester]

Can you share some insights how to get approved to Zen business with VASP license as a crypto exchange?
PM me if possible

To be honest, I do not think I am the right person for this advice – this is not a standard business account opening but a specific task; and I admit I am not engaged in the crypto business, so my knowledge about all concerning the exchanges is limited.
I'll PM you to check the basics, probably tomorrow (European time) as I am a little busy today; but do not expect much...