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Managing the risks of payment methods when working overseas

Photo of Stephen Mathews Stephen Mathews
3 min

Risk – the big picture

Risk is part and parcel of everyday life. The book of Acts shows the early church prepared to take risks as they embarked on the adventure which God placed before them. When driving in the dark, we don’t stop driving but we do turn on our lights to see better what is ahead; in the same way, taking risks does not mean that we just go on haphazardly or recklessly. Before being accepted, risks need to be properly assessed and managed within the overall context of the role of trustee.

The Charity Commission’s concerns over international payments

In recent years, the Charity Commission has chosen to issue an alert for all trustees about managing the risk of making payments, particularly those charities making payments or moving funds abroad. In essence, it reminds trustees of their responsibilities in protecting charity funds, expecting charities to make use of the regulated financial sector when making international payments or when transferring funds abroad.

The Charity Commission recognises the many advantages of banking within the regulated sector, including good governance, the easy provision of an audit trail and prudent financial management. It goes so far as saying that “where regulated banking services are available it would be difficult to argue that trustees had properly discharged their duties where they had not used them to transfer funds”. Although the Commission recognises that modern banking systems are generally highly sophisticated and reliable it reminds trustees that they are not always entirely risk free.

More importantly the Commission reminds trustees that where alternative methods of transferring funds are used (i.e. not using the regulated financial sector) then trustees need to manage the higher risks that come with these methods of transfer and do more to demonstrate that funds have and can be accounted for and are adequately protected.

What does this mean for churches?

In the main, it is clear that the Charity Commission expects all charities (including churches) to make international transfers via the regulated UK banking sector. Whilst for most churches this continues to be the normal course of action, there may be some instances, particularly for churches working in certain jurisdictions, where they might wish to make payments in different ways.

This is normally due to either safety or economic (poor exchange rate) concerns. The Commission does not prohibit funds being transferred outside of the regulated system, but points out that trustees need to demonstrate that they are managing the higher risk.

The charity's 'Annual return’ required by the Commission each year will also need to be completed for the questions about alternatives used by the charity when the regulated banking system is not used. Trustees should be aware that this will act as a potential 'risk flag’ as part of the Commissions monitoring process.

What practical steps can church trustees take?

Before making a payment or transfer outside of the regulated UK banking sector, there are a few steps that the church trustees should take.

Step 1 – Consider the various options which are open to them.

Step 2 – Seek to understand the risks associated with each option.

Step 3 – Where deciding that the best course of action is for the church to make an international payment or transfer outside of the regulated banking sector, the reasons for doing so should be clearly documented.

Step 4 – As far as possible introduce controls to ensure that any payment or transfer (whether inside or outside the regulated sector) is properly received.

Step 5 – Take measures to ensure that the transferred funds have been used for the purpose for which they were intended.


There may be situations where church trustees conclude that transferring funds outside of the regulated banking system is the only or best option available in order for the church to fulfil its purpose. Whilst these situations are likely to be rare, the very act of thinking through the issues often helps churches improve what they do, and by taking the steps set out above trustees will be able to demonstrate that they have taken a reasoned, and a reasonable approach.

Profile image of Stephen Mathews
Written by

Stephen Mathews

Stephen has been at Stewardship for 15 years, advising churches and Christian charities on a breadth of issues around money, culture and governance. Previous to that, he gained valuable experience working for 20 years in the accountancy profession, alongside church leadership in his spare time.

Stephen is passionate about Local Church, UK Poverty & Debt, and International Aid, with a particular focus on educational development in Africa and in youth violence and racial inequality.