Delegating bank signing authority means allowing a person other than the legal representative to carry out operations on a company bank account, within defined limits (amount, type of operation, account concerned). The delegation is formalised through a bank mandate filed with the bank, which states who can sign what, and under which rules.
Why delegate bank signing authority?
In a growing company, the legal representative can no longer sign every transfer, direct debit and bank order alone. Delegation makes it possible to:
- Keep operations flowing: treasury or accounting teams sign day-to-day operations without going back to the executive every time.
- Frame the authority: each delegate has a precise scope (a ceiling, specific accounts), not unlimited access.
- Reduce risk: dual signature above a certain amount lowers the risk of fraud and error.
What is the legal framework for delegated signing authority?
The delegation rests on two levels:
- The internal delegation of authority: a document by which the legal representative grants an employee the power to commit the company within a given scope. It must be written, dated, and state the exact extent of the authority.
- The mandate filed with the bank: a bank only recognises the signatories that have been declared to it. As long as a signatory is not registered with the bank, their signature has no value, even if the internal delegation exists.
This double requirement is what makes the management complex: the internal side and the bank side must stay perfectly synchronised, bank by bank.
How to delegate bank signing authority, step by step
- Define the scope: who, on which account(s), for which type of operation, up to which amount, and alone or under joint signature.
- Formalise the internal delegation: a deed signed by the legal representative.
- Declare the signatory to the bank: through the bank’s own mandate (paper form, or electronic eBAM exchange when the bank supports it).
- Keep the proof: archive the mandate and log every change, for audit.
- Review regularly: remove the authority of people who have left the company or changed roles.
What are the mistakes to avoid?
- Forgetting to remove a signatory who has left the company. The most frequent and most dangerous risk: a former employee whose signing authority is still active at the bank.
- Managing signing authorities in a spreadsheet. An Excel file does not log changes and quickly drifts away from what the banks actually have on file.
- Confusing the internal delegation with the declaration to the bank. Both are required; one without the other offers no protection.
- Setting no ceiling. A delegation without an amount limit exposes the company.
How to centralise the management of delegations?
Once a company spans several entities, several banks and dozens of signatories, manual tracking becomes unmanageable. A dedicated platform like Kable centralises in a single referential who can sign what, at which bank, for which entity and up to which amount, generates the bank mandates automatically, and keeps an audit trail of every change of authority. This is exactly the problem that centralised bank mandate management solves for treasury teams.