A transfer of value means a transfer of money, virtual assets or property. It doesn’t include: 

• the transfer of physical currency or tangible property
• the transfer of securities or derivatives, unless these are also virtual assets
• transfers as part of some payroll and superannuation services.

The travel rule requires businesses to collect information from the payer, verify certain information and pass on information to other businesses involved in a transfer of value. There’s no minimum amount for a value transfer. The travel rule applies to international or domestic value transfers of any amount.

You generally won’t be providing an ordering institution or a beneficiary institution designated service if a transfer of value is reasonably incidental to providing another service. The other service does not have to be a designated service. This means you also won’t be required to comply with the travel rule. 

This exception applies for all businesses except:

• financial institutions
• gambling service providers, currency exchanges and virtual asset service providers (VASPs), when involved in international value transfer services. 

For example, if you:

• manage a fleet of cars on behalf of your customers, and receive money from customers to pay for maintenance of the cars, the transfer of value is incidental to service of managing the fleet
• are a stockbroker and you sell shares on behalf of a customer, and at the request of the customer you transfer the value to the customer’s bank account, the transfer of value is incidental to stockbroking services (note, the stockbroking services are likely to be a designated service in their own right)
• sell gift cards that can only be used with certain retailers and then transfer the value to retailers when the gift cardholder buys goods or services, the transfer of value is incidental to retail services (note, depending on the value of the gift card, you may be providing a separate ‘stored value card’ designated service)
• operate an online marketplace and transfer value from people buying goods and services via a financial institution or remitter to the retailers of those services, the transfer of value is incidental to retail services
• aren’t a financial institution and you provide clearing and settlement services for the sale and purchase of securities and derivatives that aren’t virtual assets, the service is incidental to clearing and settlement services
• provide financial counselling, negotiate with creditors on behalf of people experiencing financial hardships and facilitate transfers of value under repayment plans, the transfers of value are incidental to debt management services. 

Another example is where you are a legal practitioner, accountant or real estate agent and transfer value from your trust account for a transaction that is part of broader professional or brokering services you provide to your client. In these cases, the transfer of value is incidental to those professional or brokering services (note, if you allow clients to use your trust account as a substitute for a bank account, for example, there’s objectively no other professional service being provided, then the transfer of value will itself be a designated service and subject to the travel rule)

In all cases, the financial institutions or remitters involved in transferring the money will be providing value transfer services and are subject to the travel rule.

The transfer of value must objectively be incidental to the other service. It’s not enough just to say it’s incidental or to believe (unreasonably) that the transfer of value is incidental. Simply providing another service with a transfer of value doesn’t automatically make the transfer incidental, especially if the intention of providing that other service is to avoid regulation. 

An example where the value transfer service is not reasonably incidental is if the service you’re providing is a specialised value transfer service under a proprietary or industry-specific name. How a service is described or marketed is irrelevant, the service remains a value transfer service.

A transfer of value may be reasonably incidental to another service, if the service necessarily involves more than simply transferring value. This may be where the service involves activities that are beyond the transfer of value to give effect to the purchase or sale of: 

• goods
• services
• securities or derivatives that aren’t virtual assets.

Local transfers of value in other countries or the European Economic Area

Travel rule obligations under Australian law don’t apply to transfers of money or property within a single overseas country or within the European Economic Area if the: 

• foreign country where the value transfer services are being provided has implemented laws relating to the travel rule
• value transfer service complies with these foreign travel rule laws.

While the travel rule doesn’t apply under Australian law, these services are still designated services. You must still comply with other anti-money laundering and counter-terrorism financing (AML/CTF) obligations that apply to designated services through foreign branches and subsidiaries, such as customer due diligence (CDD). 

Learn more about foreign branches and subsidiaries.

Administrative payroll payments

The travel rule doesn’t apply to a transfer of money that an administrator completes for a client where the:

• payment relates to employee payments or benefits
• transfer doesn’t involve the administrator receiving physical money
• transfer doesn’t involve the payee receiving physical money.

Securities and derivatives

The travel rule doesn’t apply to transfers of securities or derivatives that aren’t virtual assets. This excludes the transfer of shares from being transfers of value. However, transfers of tokenised shares are subject to the travel rule. 

Transfers of stablecoins are also subject to the travel rule even if the stablecoin meets the definition of a ‘derivative’.

Transfers of value between financial institutions

The travel rule doesn’t apply to transfers of value where either the:

• payer and payee of the value transfer are both financial institutions acting on their own behalf
• transfer uses the Society for Worldwide Interbank Financial Telecommunication (SWIFT) payment system and the payer and payee are both acting on their own behalf and are supervised financial institutions under the SWIFT Corporate Rules.

Merchant payments – ordering institution obligations

You don’t need to collect or verify information about the payer or payee when the transfer is:

• a merchant payment
• refunding a merchant payment. 

For these card-based transfers a transfer message only needs to include the number of the card the payer used. 

A card number can also include a tokenised reference. Tokenisation involves replacing a card number (for example, the primary account number or PAN) with a unique reference number for one or more ‘links’ in a value transfer chain. Tokenisation reduces fraud and data security risks associated with card payments but allows the ordering institution to trace the payment back to the cardholder. Tokenisation is commonly done for consumer card payments using smart phones.

A transfer is a merchant payment where all the following conditions are satisfied, the: 

• transferred value is money
• money is transferred to a merchant
• transfer uses a credit card, debit card or stored value card
• ordering institution issued the card to the payer
• beneficiary institution initiates the transfer and conveys the instructions to the ordering institution
• beneficiary institution makes the money available to the payee (it doesn’t matter if the beneficiary institution hasn’t yet received the money from the ordering institution)
• ordering institution transfers money to the beneficiary institution.

An example of this exemption could be a customer using a debit card for retail purchases. To complete this transaction, the:

• customer’s card interacts with the merchant terminal provided by merchant acquirer bank
• merchant acquirer (beneficiary institution) then initiates the transfer process by conveying the payer’s instruction to the card issuer (the ordering institution)
• card issuer then sends a transfer message back to the merchant acquirer authorising the transfer. 

Cheques drawn on the ordering institution

An instruction given to an ordering institution by means of a cheque that’s drawn on the ordering institution is exempt from the travel rule.

A transfer of value funded by a cheque drawn on a third-party financial institution isn’t exempt. For example, where a customer provides a cheque to a remitter who then subsequently transfers that value. 

Pre-commencement customers

An ordering institution that provides value transfer services to pre-commencement customers will have different verification requirements. In these cases, the ordering institution won’t verify the payer information unless there are reasonable grounds to doubt that the information is adequate and accurate.

Transitional exemptions for existing customers

An ordering institution isn’t required to verify the information it includes in a transfer message when:

• the ordering institution accepts the instruction to provide the value transfer service before 1 July 2030
• there are no reasonable reasons to doubt that the payer information is adequate and accurate.

And when the ordering institution either:

• conducted the applicable customer identification procedure for the customer before 31 March 2026 (the equivalent of initial CDD before the reforms)
• provides a value transfer service in a permanent foreign establishment and before 31 March 2026 completed initial CDD in compliance with that country’s CDD and record-keeping laws.

This exemption won’t apply to instructions accepted on or after 1 July 2030.

Self-hosted virtual asset wallets

An ordering institution that’s completing a transfer of value to a self-hosted virtual asset wallet isn’t required to pass on travel rule information, but must still: 

• collect payer information and the payee’s full name
• verify payer information.

Related pages

• Travel rule overview
• Travel rule obligations for ordering institutions
• Travel rule obligations for intermediary institutions
• Travel rule obligations for beneficiary institutions
• Travel rule obligations when transferring virtual assets