What is the payment due date for Instant Funding?
The payment due date for Instant Funding transfers will be on T+1 by 1 pm ET. Itâs also important to note that Instant Funding Transfers created after 8 pm on T+0 will be considered as next day meaning that the system date is considered as T+1 and the transfer will be due for settlement on T+2 by 1 pm ET. The system_date field that is returned via the Instant Funding API will be the source of truth for determining the date that the instant funding transfer was created on and the deadline field that is returned will be the source of truth for determining the date settlement is expected.
Will there be a charge for late payment?
Yes, the federal interest rate + 8% will be charged if payments are not received on time. This is an annual interest rate that is charged on a daily basis.
Is Instant Funding available for all international partners?
Instant Funding as an Alpaca Broker API product is available in the international countries listed here.
Can partners set specific limits on end-customer accounts?
The default limit for end-customer accounts is $1,000, but partners can send a request to modify the limit, which will be analyzed on a case-by-case basis.
Is the partner required to submit documents or info for Instant Funding approval?
Yes, we would request partners to submit financials for creditworthiness. Please reach out to a sales representative or [email protected] to learn more about what documents would be required to be submitted for approval.
Can Instant Funding be tested in Sandbox first?
Yes, you can test Instant Funding on Sandbox. To get started, kindly reach out to your sales representative or customer success manager, who will enable this feature for you.
What happens if I donât settle an instant funding transfer?
Instant funding transfers will be automatically canceled if payment is not received by the end of day on T+1. This means that the extension of buying power is removed from the account. If the instant funding transfer has been used to purchase any asset, the cash balance in the customer account at T+1 will be used to offset the instant funding transfer. Should this result in a negative balance on the account, Alpaca will sell off assets in the account on T+2 to cover the overdue instant funding balance. Daily interest will be charged at the margin interest rate until the account no longer has a negative balance. Late payment interest will be charged on the instant funding transfer for 1 day.
Will interest accrued for late payments be deducted directly from the account?
Interest for late payments will be accrued and invoiced to you on a monthly basis.
What happens if I am unable to complete settlement because the amount that I sent to Alpaca for reconciliation is not the same amount that is credited to my firm account?
This can happen for example in the event that an unexpected wire fee is taken from an intermediary bank on the way to Alpaca. If the amount you sent to Alpaca is different than the amount credited to your SI firm account then you can leverage a pre-funded firm account, denoted by the RF suffix, to journal the missing amount to your SI account to successfully complete settlement.
Can I combine Instant Funding with other funding methods?
As the list of funding products at Alpaca is continuously growing itâs always best to check with your customer success manager to confirm that instant funding can be combined with other products. Instant Funding is compatible with all other funding products other than JIT. Itâs also important to note that instant funding may not be compatible with other product lines such as our local currency trading product.
Why do I need to send travel rule information?
Alpaca is a financial institution so it is required by US law for us to collect travel rule information when dealing with the movement of funds. Since instant funding transfers are only an extension of buying power we only require travel rule information upon settlement since that is when the instant funding transfer is converted to actual settled cash. For more information on the travel rule requirements please refer to the FinCEN Advisory as needed.
The content article is for general information only and is believed to be accurate as of posting date but may be subject to change. Alpaca does not provide investment, tax, or legal advice. Please consult your own independent advisor as to any investment, tax, or legal statements made herein.
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