---
title: "Identity verification and AML - NexPay"
description: "How NexPay handles anti-money laundering checks and payer identity verification — why documents are asked for, and how to avoid delays."
lastModified: "2026-06-02"
lang: "en"
url: https://nexpay.com.au/training/trust-and-compliance/identity-verification-and-aml
---
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# Identity verification and AML - NexPay

## At a glance

- **Intended for:** Agents, admins & payers
- **Reading time:** 5 minutes
- **Last updated:** 1st June 2026

**TL;DR:** Every payment through NexPay is verified — it's a legal requirement under NexPay's Australian Financial Services Licence and AML/CTF rules, and it's what keeps payments trustworthy. NexPay confirms four things per payment: the payer's identity, the purpose of the payment, business details for company payers, and proof of payment. The payer's ID must match the bank account sending the funds — mismatches are the top cause of holds. A hold isn't a rejection; it means one more thing is needed.

{/* Body content adapted from the prior AML article — legal facts preserved, links and UI references updated */}

Sending money overseas involves a lot of trust. You're trusting that your funds will arrive safely, and the institutions along the way are trusting that the money is legitimate. That's where identity verification comes in — not as a hurdle, but as the thing that keeps your payments moving smoothly and protects everyone involved.

This article explains why NexPay asks for the documents it does, what happens behind the scenes when your payment is reviewed, and how to avoid delays.

> **For agents and school admins:** The sections on what NexPay collects and how holds work directly affect how quickly your clients' payments clear. **For payers:** the first two sections answer most questions about why documents are required and what to expect.

## How NexPay keeps your money safe

NexPay holds Australian Financial Services Licence No. 560782 (ABN 56 153 910 984), which authorises it to provide non-cash payment services, and it is registered with AUSTRAC as a remittance service provider. As part of that framework, NexPay follows strict Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) rules set by Australian law.

In plain terms: every payment that flows through NexPay goes through a verification process. This isn't optional — it's a legal requirement. But more importantly, it's what makes international payments trustworthy. When a university in Australia receives funds through NexPay, it knows those funds have been verified. When a parent in Colombia sends tuition, they know the system is protecting their transfer.

> **Worth knowing:** These checks aren't unique to NexPay. Any regulated payment provider in Australia follows the same rules. The difference is how smoothly the process runs — and that depends largely on having the right documents ready up front.

## What NexPay verifies for each payment

Every payment goes through four checks. Getting these right the first time is the single best way to avoid holds or delays.

### 1. Payer identification

NexPay needs to confirm who is sending the money. This means a clear, colour copy of the payer's passport or national ID card — front and back — showing the payer's date of birth and the expiry date.

The name on the ID must match the name on the bank account sending the funds. If a parent is paying, the parent's ID is required — not the student's.

### 2. Evidence of payment purpose

Every payment needs a clear reason. For education payments, this is typically one of:

- A Letter of Offer from the institution
- A Confirmation of Enrolment
- An invoice from the school or provider
- A student visa or work visa

This confirms the funds are going where they should, for the reason stated.

### 3. Business information for company payers

When a company is making the payment rather than an individual, NexPay also collects business registration details and verifies the company's identity. This is standard Know Your Customer (KYC) due diligence — it confirms the business is legitimate and authorised to send funds.

### 4. Proof of payment

NexPay needs to see how the funds were sent. Bank (wire) transfer is the accepted method. Cash deposits, cheques, and money orders are not accepted — these can't be traced back to a specific sender, which makes verification impossible.

> **Quick tip:** Before starting a payment, make sure the payer's bank account name matches the name on their ID. Mismatches are the most common reason payments are placed on hold.

## What happens when something doesn't match

If a payment can't be fully verified — a blurry ID, a name mismatch, a missing letter of offer — it gets placed on hold. This isn't a rejection. It means the team needs a bit more information before the payment can proceed.

Here's what the hold process looks like:

1. The payment status changes to **On Hold** (you'll see it on the dashboard's On Hold summary card)
2. The NexPay team emails you explaining exactly what's needed
3. You upload the missing or corrected document through the platform
4. The team reviews and clears the payment

Most holds are resolved quickly once the right document is provided. The key is responding to that email promptly.

> **For agents:** If you see a growing number of payments on hold, it's usually a pattern — the same document missing across several payments. Check whether your payers are consistently submitting complete ID copies and current letters of offer. A quick reminder at the start saves days later.

## Who can send a private payment

For private payments — where an individual, not a company, sends funds — only individual payers are accepted. The person whose name appears on the bank transfer must be a real person, and their identity document must match.

The payer doesn't have to be the student. Parents, spouses, relatives, and friends can all pay — but the payer's own ID and bank account details are what NexPay verifies, and the relationship to the student is recorded during the payment.

Company accounts can't be used for private payments. If a business needs to pay, it follows the company payment process with its own document requirements. See [document requirements](/training/trust-and-compliance/document-requirements.md) for the full breakdown.

> **Important:** Bank (wire) transfer is the accepted method for private payments. If a payer tries to send funds by cash deposit, cheque, or money order, the payment can't be processed and the funds will need to be returned.

## Your next step

- **Preparing to send your first payment?** See [document requirements](/training/trust-and-compliance/document-requirements.md) for a complete checklist, separated by private and company payments.
- **Already have a payment on hold?** Check your email for the specific instructions, then upload the requested document — see [uploading documents](/training/payments/uploading-documents.md). If you're unsure what's needed, reach your account manager from the home-screen support card.
- **Concerned about how your data is handled?** Read [privacy and data protection](/training/trust-and-compliance/privacy-and-data-protection.md).

## Checkpoint

After reading this, you should be able to:

- Explain why NexPay requires identity verification (a legal and safety requirement under its AFSL and AUSTRAC registration)
- Name the four things NexPay verifies for each payment
- Understand why the payer's ID must match their bank account name
- Know what to do when a payment is placed on hold
- Explain the difference between who can send private versus company payments

## Frequently asked questions

### Why must I upload ID documentation?

As part of NexPay's security framework and legal obligations, it's required to identify the payer for every transaction. It's how funds are confirmed to come from a legitimate source and reach the right institution — a routine, expected part of moving money safely, not a sign anything is wrong.

### Who accesses my personal information?

Your personal information is used only for verification and compliance purposes and is never shared with third parties without your consent. For the full picture of how your data is handled, see the privacy and data protection guide.

### What does NexPay collect for each payment?

For every payment: clear valid identification of the payer including photo ID, evidence of the payment purpose with supporting documents, business (KYC) information for company payers, and clear proof of payment.

### What happens if my payment doesn't comply?

It may be placed on hold, returned, or require additional documentation before proceeding. A hold is not a rejection — it means the team needs one more thing. Responding promptly to the email that explains what's needed is the fastest way to clear it.

### Does the payer have to be the student?

No. Parents, spouses, relatives, and friends can all pay. What NexPay verifies is the payer's own ID and that it matches the bank account sending the funds. The relationship to the student is recorded during the payment.

### Why isn't a cash deposit or cheque accepted?

Because those methods can't be reliably traced back to a specific sender, which makes verification impossible. Bank (wire) transfer is the accepted method precisely because it ties the funds to an identified payer.

## More on NexPay

**Platform**

- [For students & parents](/for-students-and-parents.md)
- [For ed. agents](/for-education-agents.md)
- [For universities](/for-universities.md)
- [For schools](/for-schools.md)
- [For accommodation](/for-accommodation.md)
- [AI automation](/payments-ai-automation.md)
- [Pricing](/pricing.md)

**Help & resources**

- [Training](/training.md)
- [Contact](/contact-us.md)
- [Developers](/api.md)
- [Zapier integration](/zapier.md)
- [Claude & ChatGPT](/mcp.md) — Claude & ChatGPT integration

**Company**

- [About](/about.md) — About NexPay
- [Jobs](/about.md#jobs)
- [Blog](/blog.md)
- [Media](/media.md)
- [Events](/events.md)

**Trust & locations**

- [Trust & Regulatory](/trust.md)
- [Our offices](/locations.md)

**Legal**

- [Terms and Conditions](/terms-and-conditions/)
- [Privacy policy](/privacy-policy/)
- [Cookie Policy](/cookie-policy/)
- [Complaints Policy](/complaints-policy/)
- [Financial Services Guide](/financial-services-guide/)
- [Product Disclosure Statement](/product-disclosure-statement/)
- [AML Policy](/aml-policy/)
- [Target Market Determination](/target-market-determination/)
- [Group Regulatory Disclosure](/group-regulatory-disclosure/)
- [Fees & FX Schedule](/fees-and-fx/)
- [Developer & API Terms](/developer-terms/)

## NexPay

NexPay Pty Ltd (ABN 56 153 910 984) holds Australian Financial Services Licence No. 560782 and is authorised to provide non-cash payment services to retail and wholesale clients in Australia.

- **Address:** Level 12, 64 York St, Sydney NSW 2000, Australia
- **Support:** [support@nexpay.com.au](mailto:support@nexpay.com.au)
- **Status:** [https://nexpay1.statuspage.io/](https://nexpay1.statuspage.io/)

**Follow NexPay**

- [LinkedIn](https://au.linkedin.com/company/nexpay)
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© NexPay Pty Ltd