Terms of Service

1. Agreement to Terms

These Terms of Service (“Terms”) constitute a legally binding agreement between you (“you,” “your,” or “User”) and Velvet Labs Inc. (“Velvet,” “we,” “us,” or “our”) governing your access to and use of the website located at www.joinvelvet.io, any associated mobile applications, and the money transfer and currency exchange services offered by Velvet (collectively, the “Services”).

BY ACCESSING OR USING THE SERVICES, CREATING AN ACCOUNT, OR INITIATING ANY TRANSACTION, YOU ACKNOWLEDGE THAT YOU HAVE READ, UNDERSTOOD, AND AGREE TO BE BOUND BY THESE TERMS AND OUR PRIVACY POLICY (WHICH IS INCORPORATED BY REFERENCE). IF YOU DO NOT AGREE TO THESE TERMS, YOU MUST NOT ACCESS OR USE THE SERVICES.

If you are using the Services on behalf of a business or other legal entity, you represent and warrant that you have the authority to bind that entity to these Terms, and “you” will refer to that entity.

2. Company Information and Regulatory Status

Velvet Labs Inc. is a corporation incorporated under the Canada Business Corporations Act on June 3, 2026. Federal Corporation Number: 1798892-3. Ontario Corporation Number: 1001633476. Registered office: 7 Seed Court, Brampton, Ontario L6X 5E4, Canada.

Velvet intends to operate as a Money Services Business (MSB) in Canada and will register with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as required before offering regulated services. We will also comply with applicable requirements under the Retail Payment Activities Act (RPAA) and any registration with the Bank of Canada as a Payment Service Provider where required. Regulatory status and registration numbers will be updated in these Terms and on our website once obtained.

3. Definitions

In these Terms, unless the context otherwise requires:

“Account” means the user account you register to access and use the Services.

“Balance” means any non-interest-bearing amount held by Velvet on your behalf for the purpose of facilitating transfers or exchanges.

“Business Day” means any day other than a Saturday, Sunday, or statutory holiday in the Province of Ontario.

“Payment Account” means the authorized funding source (such as a bank account or payment card) you use to fund transfers.

“Recipient” means the individual or entity designated by you to receive funds through the Services.

“Transfer” means a money transfer or currency exchange transaction initiated through the Services.

“Privacy Policy” means the Velvet Labs Inc. Privacy Policy available at www.joinvelvet.io/privacy (or successor URL), as updated from time to time.

4. Description of Services

Velvet provides online money transfer and currency exchange services to individual and business end-users through its platform at www.joinvelvet.io. The Services enable users to send funds to designated recipients and to exchange currencies subject to supported corridors, limits, and conditions displayed on the platform.

Supported currencies, destination countries, transfer limits, fees, and exchange rates are determined by Velvet and may change from time to time. We do not accept physical cash, cheques, money orders, or other physical instruments. All funding and payouts occur through electronic means supported by the platform (such as bank transfer, Interac e-Transfer, or other approved methods).

Velvet is not a bank, credit union, or deposit-taking institution. Any Balance held in your Account is not a deposit, is not insured by the Canada Deposit Insurance Corporation (CDIC) or any similar deposit protection scheme, and represents an unsecured claim against Velvet. Customer funds are managed in accordance with applicable money services business and payment services rules.

5. Eligibility and Account Registration

To use the Services, you must meet all of the following eligibility requirements:

1. You must be at least 18 years of age and have the legal capacity to enter into binding contracts under applicable law.
2. You must provide true, accurate, current, and complete information during registration and keep that information updated at all times.
3. You must not be identified on any sanctions list administered by Canada, the United Nations, the United States, the European Union, or any other relevant authority.
4. You must not be a Politically Exposed Person (PEP) or a family member or close associate of a PEP in circumstances that prohibit us from providing services under applicable law, or you must successfully complete enhanced due diligence if we elect to onboard you.
5. You must not be a resident of any jurisdiction where the Services are prohibited or restricted. We reserve the right to restrict or refuse service to residents of certain jurisdictions (including, if applicable, Quebec) based on regulatory requirements.
6. You must use the Services only for lawful purposes and in compliance with all applicable laws and regulations.

We may refuse to open an Account, or may suspend or close an existing Account, at our sole discretion if we determine that you do not meet eligibility requirements or that providing Services would pose unacceptable risk or violate law.

6. Account Security and User Responsibilities

You are solely responsible for maintaining the confidentiality and security of your Account credentials, including usernames, passwords, PINs, and multi-factor authentication devices or codes. You must not share your credentials with any third party.

You are responsible for all activities that occur under your Account, whether or not authorized by you, except to the extent that unauthorized activity results from our failure to implement reasonable security measures. You must immediately notify us of any actual or suspected unauthorized access, loss of credentials, or other security breach.

You agree to use strong, unique passwords and to enable multi-factor authentication where available. You must ensure that any email account associated with your Velvet Account is secure and accessible only by you.

You may generally register and maintain only one Account. Creating multiple Accounts without our prior written permission is prohibited and may result in suspension or termination of all related Accounts.

7. Identity Verification (KYC) and Ongoing Due Diligence

In accordance with the PCMLTFA and FINTRAC requirements, we must verify your identity and, where applicable, the identity of beneficial owners and authorized persons before providing certain Services. You authorize us to collect, use, and disclose information (including from third-party verification providers, credit bureaus, and government databases) for this purpose.

We may request additional information or documentation at any time, including updated identification, source-of-funds information, or explanations of transaction activity. Failure to provide requested information promptly may result in delays, suspension of transactions, or Account closure.

We reserve the right to re-verify identity and to conduct ongoing monitoring of Accounts and transactions throughout the business relationship.

8. Transfers, Funding, and Currency Exchange

8.1 Initiating Transfers

You may initiate Transfers by providing accurate instructions through the platform, including Recipient details, amount, currency, and purpose. You authorize Velvet to process the Transfer in accordance with your confirmed instructions.

8.2 Accuracy of Instructions

You are solely responsible for the accuracy of all information you provide, including Recipient name, account numbers, and contact details. Once a Transfer is confirmed, it is generally final and irreversible. We provide tools to review instructions before confirmation. Losses resulting from incorrect or mistyped Recipient information are your sole responsibility. We may, at our absolute discretion and subject to feasibility and applicable fees, attempt to recall or reverse a Transfer upon your request, but we do not guarantee success.

8.3 Funding

You may fund Transfers using authorized Payment Accounts supported by the platform. By initiating a funding transaction, you authorize us and our payment processors to debit the designated Payment Account. Funding methods, limits, and processing times are displayed in the platform and may vary.

8.4 Limits

We may impose limits on the amount, frequency, or velocity of Transfers for risk management, compliance, or operational reasons. Limits may vary based on verification status, transaction history, and other factors.

8.5 Exchange Rates

Currency exchange rates are determined by Velvet and are displayed before you confirm a transaction. Rates may fluctuate with market conditions and may include a margin. The rate applied to your transaction is the rate locked at the time of confirmation (subject to any stated validity period). We are not liable for rate movements after confirmation.

9. Fees, Exchange Rates, and Pricing

Applicable fees, exchange rates, and any other charges are disclosed in the platform before you confirm a Transfer. By confirming a Transfer, you agree to pay the displayed fees and accept the displayed rate.

We reserve the right to change fees, rates, limits, and pricing structures at any time. Changes will apply to future transactions. We will not be liable for any changes in pricing or for the unavailability of previously offered rates or corridors.

10. Prohibited Uses and Compliance Obligations

You agree not to use the Services for any unlawful, fraudulent, or prohibited purpose, including but not limited to:

• Money laundering, terrorist financing, or proliferation financing;
• Fraud, identity theft, or misrepresentation;
• Violation of sanctions or export control laws;
• Funding of illegal activities or goods/services prohibited by law;
• Structuring transactions to evade reporting or record-keeping requirements;
• Using the Services on behalf of third parties without proper authorization and disclosure;
• Any activity that could harm Velvet, other users, or the integrity of the financial system.

You agree to use the Services in full compliance with all applicable laws and regulations, including AML/CTF laws, tax laws, and foreign exchange controls. We may monitor transactions and report suspicious activity to FINTRAC or other authorities without notice to you.

11. Transaction Monitoring, Delays, and Refusals

We reserve the right, at our sole discretion and without liability, to delay, suspend, cancel, reverse, or refuse any Transfer or Account activity for any reason, including but not limited to: compliance concerns, sanctions screening hits, incomplete verification, suspected fraud or illegal activity, technical issues, or instructions from regulators or law enforcement.

We will not be liable for any losses, costs, or damages arising from such delays, suspensions, cancellations, or refusals, except to the extent required by applicable law.

12. Nature of Account and Customer Funds

Velvet is not a bank. Your Account is not a bank account or deposit account. Any Balance held by Velvet represents an unsecured contractual claim against us and is not protected by CDIC or any similar scheme.

We manage customer funds in accordance with applicable legal and regulatory requirements for money services businesses. Customer funds are not used for our general corporate purposes and are intended to be available to satisfy customer claims in the ordinary course of business.

13. Intellectual Property

All right, title, and interest in and to the Services, including all software, text, graphics, logos, trademarks, service marks, designs, and other content and materials (collectively, “Velvet Materials”), are owned by Velvet or its licensors and are protected by Canadian and international intellectual property laws.

You are granted a limited, non-exclusive, non-transferable, revocable license to access and use the Services for their intended purpose in accordance with these Terms. You may not copy, modify, distribute, sell, lease, reverse-engineer, decompile, or create derivative works of any Velvet Materials without our prior written consent.

14. Disclaimers and Limitation of Liability

14.1 Disclaimer of Warranties

THE SERVICES ARE PROVIDED ON AN “AS IS” AND “AS AVAILABLE” BASIS. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, VELVET DISCLAIMS ALL WARRANTIES, WHETHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND NON-INFRINGEMENT. WE DO NOT WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED, ERROR-FREE, SECURE, OR FREE OF VIRUSES OR OTHER HARMFUL COMPONENTS, OR THAT ANY TRANSFER WILL BE COMPLETED WITHIN ANY PARTICULAR TIMEFRAME.

14.2 Limitation of Liability

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO EVENT SHALL VELVET OR ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, AFFILIATES, OR LICENSORS BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, PUNITIVE, OR EXEMPLARY DAMAGES, OR ANY LOSS OF PROFITS, REVENUE, DATA, GOODWILL, OR OTHER INTANGIBLE LOSSES, ARISING OUT OF OR RELATED TO YOUR USE OF OR INABILITY TO USE THE SERVICES, WHETHER BASED ON WARRANTY, CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR ANY OTHER LEGAL THEORY, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, OUR AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THESE TERMS OR THE SERVICES SHALL NOT EXCEED THE GREATER OF (A) THE TOTAL FEES YOU PAID TO VELVET FOR THE SPECIFIC TRANSACTION(S) GIVING RISE TO THE CLAIM DURING THE TWELVE (12) MONTHS PRECEDING THE CLAIM, OR (B) ONE HUNDRED CANADIAN DOLLARS (CAD $100). THE FOREGOING LIMITATIONS SHALL NOT APPLY TO LIABILITY THAT CANNOT BE LIMITED OR EXCLUDED UNDER APPLICABLE LAW (INCLUDING LIABILITY FOR GROSS NEGLIGENCE, WILLFUL MISCONDUCT, OR FRAUD, OR CERTAIN CONSUMER PROTECTION RIGHTS).

15. Indemnification

You agree to indemnify, defend, and hold harmless Velvet Labs Inc. and its directors, officers, employees, agents, affiliates, successors, and assigns from and against any and all claims, demands, actions, damages, losses, liabilities, costs, and expenses (including reasonable legal fees and disbursements) arising out of or related to: (a) your use of the Services; (b) your violation of these Terms or any applicable law; (c) your infringement of any third-party right; (d) any content or information you submit; or (e) any dispute between you and a Recipient or third party.

16. Suspension, Termination, and Account Closure

16.1 Suspension or Termination by Velvet

We may, at our sole discretion and without prior notice (except as required by law), suspend, restrict, or terminate your access to the Services or close your Account for any reason, including but not limited to: breach of these Terms; failure to provide required information; suspected fraud, illegal activity, or sanctions exposure; extended inactivity; risk management concerns; or a request or direction from a regulator, court, or law enforcement agency.

16.2 Account Closure by You

You may request closure of your Account at any time by contacting support or using any self-service option provided. Prior to closure, you must complete or cancel any pending Transfers and withdraw or request payout of any available Balance.

16.3 Effect of Closure

Upon closure, you remain responsible for all obligations incurred prior to closure. We will provide instructions for the return of any unrestricted funds remaining in your Account. You must provide valid bank account details in your name that match your Account records within the timeframe we specify (typically 60 days). Failure to do so may result in the funds being treated as unclaimed property in accordance with applicable law. Applicable fees, conversion costs, and intermediary charges may be deducted from any refund.

Provisions of these Terms that by their nature should survive termination (including intellectual property, disclaimers, limitations of liability, indemnification, and governing law) shall survive.

17. Modifications to Services and Terms

We reserve the right to modify, suspend, or discontinue the Services (or any part thereof) at any time, with or without notice, and without liability to you or any third party.

We may also amend these Terms from time to time. When we make material changes, we will post the updated Terms on the website, update the “Last Updated” date, and, where appropriate, provide additional notice. Your continued use of the Services after the effective date of the revised Terms constitutes acceptance of the changes. If you do not agree to the revised Terms, you must stop using the Services and may close your Account.

18. Governing Law and Dispute Resolution

These Terms and any dispute arising out of or related to these Terms or the Services shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein, without regard to conflict of law principles.

Subject to any mandatory arbitration provisions or consumer rights that cannot be waived under applicable law, the courts of the Province of Ontario located in Toronto shall have exclusive jurisdiction over any dispute, and you irrevocably attorn to the jurisdiction of such courts and waive any objection based on inconvenient forum.

Nothing in these Terms limits any non-waivable statutory rights you may have as a consumer under applicable Canadian consumer protection legislation.

19. General Provisions

Entire Agreement: These Terms, together with the Privacy Policy and any additional terms presented for specific features, constitute the entire agreement between you and Velvet regarding the Services and supersede all prior or contemporaneous agreements, representations, and understandings.

Severability: If any provision of these Terms is held to be invalid, illegal, or unenforceable, the remaining provisions shall continue in full force and effect.

Waiver: No failure or delay by Velvet in exercising any right under these Terms shall constitute a waiver of that right.

Assignment: You may not assign or transfer these Terms or any rights hereunder without our prior written consent. We may assign these Terms freely without restriction.

Force Majeure: We shall not be liable for any failure or delay in performance due to circumstances beyond our reasonable control, including acts of God, natural disasters, war, terrorism, riots, embargoes, acts of civil or military authorities, fire, floods, accidents, pandemics, strikes, or shortages of transportation, facilities, fuel, energy, labor, or materials.

Notices: We may provide notices to you via email, in-app notification, or by posting on the website. You are responsible for keeping your contact information current.

Language: These Terms are drafted in English. Any translation is provided for convenience only. In the event of a conflict, the English version shall prevail (except where prohibited by applicable law, such as in Quebec).

20. Contact Information

For questions about these Terms of Service or the Services, please contact us at: