Optimal hierarchy of Organizations and Ledgers
Single vs. multiple Organizations
Banks operating as a single legal entity typically require one Organization in Midaz. However, for banking groups with subsidiaries, a hierarchical structure is recommended, with a parent organization overseeing multiple child organizations. This setup aligns with corporate governance and enables data segregation per entity.The organization structure should reflect your corporate structure.
Using multiple Ledgers
Within an organization, determine the number of ledgers to use based on operational needs. A common approach is to maintain a primary ledger for customer transactions while using additional ledgers for specialized purposes, such as treasury operations or regulatory segmentation.Use multiple ledgers only when necessary to minimize complexity. Transfers between ledgers require external flow orchestration via APIs.
Efficient account structuring for retail and corporate banking
Retail customers – Portfolio per customer
For retail banking, best practice is to create a Portfolio for each customer, containing individual accounts for different asset types (e.g., checking, savings, credit card). This setup allows efficient balance retrieval and streamlined operations.Corporate clients – hierarchical accounts
For corporate banking, utilize child accounts within portfolios to reflect internal structuring. A company might have a parent account for its main funds and child accounts for subdivisions like payroll or expense tracking.Internal accounts
Establish internal accounts for revenue, expenses, and settlement flows. Dedicated accounts for “Fee Income – USD” or “Interest Expense – USD” ensure clear financial reporting.Worked example: a typical digital bank
Here’s how a digital bank offering checking accounts, savings, and Pix transfers might structure its Midaz deployment:
How a Pix transfer flows through this structure
Operation Route validates
The “Pix Out” Transaction Route kicks in — it defines a debit from Maria’s checking account and a credit to the Settlement Account, plus an optional fee operation.
Operations execute
Four operations are created atomically: debit R 500 to Settlement, debit R$ 0.50 fee from Maria and credit to Fee Revenue.
Event published
Midaz emits a transaction event. The bank’s notification service picks it up and sends Maria a push notification.
Decision guide: when to split ledgers
| Scenario | Recommendation |
|---|---|
| Single currency, single business unit | One ledger is enough |
| Multiple currencies with occasional FX | One ledger, separate asset accounts per currency |
| Separate legal entities or subsidiaries | One ledger per entity, under separate organizations |
| Regulatory requirement for data isolation | Separate ledgers with dedicated database partitions |
| Treasury and trading operations | Dedicated treasury ledger alongside operational ledger |