TPMA

Definition

A Third-Party Managed Account (TPMA) is a payment arrangement in which a regulated provider holds and administers client funds on behalf of a professional services firm. Funds are received, safeguarded and released strictly according to the firm’s instructions and the underlying client agreement.

Why it matters

TPMAs offer a compliant, secure alternative to client money accounts operated directly by professional firms. They can remove the need to handle client funds in-house, reducing operational risk, administrative burden, and exposure under regulatory client money rules.

For solicitors, TPMAs are specifically recognised under the Solicitors Regulation Authority (SRA) Accounts Rules as a compliant method of handling client funds outside the firm’s client account.

How a TPMA works in the UK

1. Agreement – The professional firm and the TPMA provider agree terms and onboarding procedures.
2. Deposit – Client money is paid directly into the TPMA provider’s safeguarded account.
3. Verification – The provider confirms cleared funds and validates the payment instructions.
4. Release – Funds are transferred out only in accordance with the agreed instructions.
5. Reporting – Transaction records and account statements are provided to the firm and, where applicable, the client.

Note: dospay safeguards GBP funds in segregated accounts at the Bank of England via our technology banking partners.

Examples and use cases

• Solicitors – Holding funds for property transactions, settlements, or disbursements.
• Accountants – Managing large, staged payments on behalf of clients.
• Agents and brokers – Secure handling of sales proceeds or deposits.
• Construction contract administrators – Controlling stage payments to contractors or consultants.

Mini-FAQ

Q: How is a TPMA different from escrow?
A: Escrow usually relates to a specific transaction with defined release conditions, while a TPMA is an ongoing account facility for handling multiple client payments in and out.

Q: Do TPMAs need to be FCA-authorised?
A: Yes - in the UK, providing a TPMA is a regulated payment service and requires FCA authorisation and safeguarding compliance.