Direct Funding

Please note that this documentation currently focuses on the Sandbox implementation of the direct funding mechanism. Detailed production guidelines and documentation are coming soon.

Summary of the Mechanism

The direct funding mechanism for Alpaca Europe allows your end users to send funds directly from their personal bank accounts to Alpaca. To facilitate this under the European regulatory framework, the system utilizes a single Omnibus IBAN for all incoming European transfers. To ensure the funds are accurately routed and credited to the correct end user, every transfer must include a specific account identifier in the payment reference field.

Integration

From an engineering and integration standpoint, the direct funding model requires minimal backend API overhead. There is no need to call a specific API endpoint to generate or retrieve a unique funding reference for each user deposit.

The reference structure is {correspondent_id}-{account-number}, where your Correspondent ID is a static four-letter code assigned to your firm, which is readily available in your Broker Dashboard. The Account Number is automatically generated and returned when you successfully open a user's account via the POST /v1/accounts endpoint. Your application simply needs to concatenate these two known values and display the resulting string to the user as the required transfer reference.

Sandbox Simulation

Because real bank transfers cannot be processed in the sandbox environment, we provide a specific simulation endpoint.

When you hit this sandbox endpoint with the simulated deposit details, it acts as a mock wire transfer and updates the account balance in the system.

This manual trigger provides your engineering team with full control over the testing lifecycle. Because you determine exactly when the system registers that the funds have landed, you can effectively test various latency scenarios. For example, you can delay calling the POST /testing/incoming_wires simulation endpoint by 15 minutes after a user initiates a transfer in your UI, allowing you to verify that your application correctly handles and displays pending transfer states to the end user.