Accounts and Accounting

The Braid Ledger is an advanced tool that enables financial institutions to manage third-party programs, virtual accounts, fee collection, and reserves—all while ensuring real-time balance tracking and comprehensive reporting. This guide explains how the Braid Ledger operates and how it can support complex financial services.

Key Features of the Braid Ledger

Double-Entry Accounting System

• The ledger follows a double-entry system where every transaction has equal debits and credits. This ensures that all account balances remain accurate and traceable.
• This feature prevents discrepancies and guarantees a clear, synchronized record of money movement.

Hierarchical Chart of Accounts

• Accounts are structured in a tree format, allowing flexible management of virtual accounts.
• The ledger supports multiple levels of balance visibility:
  • Program Level: Aggregated balances for services offered under a single program.
  • Product Level: Balances are further segmented by individual products within a program.
  • Customer Account Level: Provides detailed insights into end-user balances.
• All these levels roll up to the financial institution's general ledger, ensuring a complete and accurate financial picture.

Transaction Control

• Every transaction specifies an end account, ensuring that balances remain synchronized across virtual accounts and the core GL.
• This control mechanism supports complex transaction flows, enabling seamless operations and reducing errors.

Virtual Accounts

• The ledger supports virtual accounts, allowing financial institutions to manage complex third-party relationships and services like fintech partnerships and B2B payment systems.
• Virtual accounts can be used as sub-accounts linked to main accounts, offering granular tracking and compliance while maintaining the flexibility needed for growth and innovation.

Fee and Reserve Management

Fee Collection

• The Braid Ledger automates fee collection, moving transaction fees to dedicated revenue accounts in real-time. This ensures accurate, timely revenue recognition and simplifies financial management.
• Fees can be applied at different stages—such as transaction processing or customer deposits—ensuring the institution captures revenue at every opportunity.

Reserve Accounts

• Reserve accounts can be set up for compliance, risk management, and liquidity requirements.
• These accounts allow institutions to maintain necessary balances to meet regulatory obligations and manage payout requirements.
• Reserves also help manage financial health, safeguarding funds for emergencies or unexpected changes in transaction flows.

How the Braid Ledger Supports Financial Institutions

The Braid Ledger provides financial institutions with the tools to:

• Gain Full Visibility: View balances at program, product, and customer levels, with all balances rolling up to the general ledger.
• Manage Complex Relationships: Handle third-party programs, nested accounts, and virtual accounts effectively, supporting complex financial services and compliance requirements.
• Ensure Compliance: Implement traceable, real-time transaction management across all account types.
• Increase Revenue: Automate fee collection and manage reserves to enhance financial stability and growth.
• Support Fintech Innovation: Provide flexible, secure, and controlled infrastructure for fintech partnerships, enabling innovation while maintaining compliance and risk control.