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I think it shouldn't.

The funding source was dropped by Github, and the terms Pocketbase accepted for funding include being paid through Github by FLOSS Fund. FLOSS Fund refused to follow the regulatory requirements to continue funding projects through Github, and Github dropped them as a funding source.

What the Pocketbase maintainer decided was to drop FLOSS Fund after they tried to renegotiate the contract in dangerous and unethical ways. FLOSS Fund chose to not follow regulatory requirements that Github required.

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Calling standard KYC paperwork for international wire transfers "dangerous and unethical" is a huge stretch. Every cross-border payment requires this stuff. The fund is literally trying to give away free money and the maintainer threw a fit because they had to fill out a tax form. I get being cautious about sharing personal info but framing compliance requirements as some kind of attack is drama for drama's sake.
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This is false. I just did an international wire transfer a few weeks ago with no KYC.
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Right, so you think.

But: your bank knows who you are and the recipient's bank knows who they are. Your transfer may have been below the increased attention threshold ($10K to $50K depending on the jurisdictions of both recipients).

Both your accounts are most likely not recent and in good standing.

And so on. I routinely make international wiretransfers as well but I'm under no illusion whatsoever that if I tried to cross an anti-money-laundering or anti-terrorism-financing threshold somewhere that the transfer would be immediately stopped and an investigation would ensue.

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The War on Terror Financing(tm) made KYC-less transfers using formal banking systems well nigh impossible. Your transaction was covered by past KYC (by your financial institution).
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Are you saying sending money via Wire transfer is unethical? Its a standard way to send money in cross boarder transactions. Please do note that India is highly regulated for financial transaction that go outside the country so, please don't spread something like they are doing it illegally. Zerodha is a well known firm they are open about this funding. 1 Million every year just because they used many oss project. That is not un ethical.
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From what I can tell, no, they weren't just asking for wire details. They were were asking for multiple forms of identification.

If I was in his place, I don't think I'd send everything required to steal my identity to some company in a foreign country that I have no legal recourse in.

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The irony is that a lot of the KYC checks are actually done in India: Jumio, Onfido, LexisNexis, Refinitiv, HyperVerge, IDfy, Signzy (a lot of major banks)

So his ID is probably there already

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Sure, but this would have changed that from "probably" to "definitely". :(
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The e-mail posted somewhere in the comments, assuming it is legit, makes it clear that FLOSS Fund requires certain paperwork for tax reasons to the benefit of the receiver. Apparently the Pocketbase developer is receiving the money personally, which means it is income and will be taxed. Apparently, again, it would also be taxed in India (the seat of FLOSS Fund) and the paperwork would allow to avoid double taxation.

This appears much more reasonable to me than the hoops I have to jump through to declare my taxes as an US expatriate and avoid double taxation with my country of residence.

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That's not 'dangerous and unethical' by the normal standards of funding application. Sure, it's not a huge amount of money. But almost every fund has some paperwork requirements and most of them are a lot more onerous than this one.

Funds don't operate outside the legal framework, they are well within it and are expected to show their paperwork at the drop of a hat to any auditor that comes knocking. If they just wired sums that are at or near the reporting requirement to any callers they'd be in pretty hot water.

I've had an AML check for the grand sum of 900 euros once.

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Its a contract where they give money in exchange for basically nothing.

It may be reasonable for pocketbase to refuse, but i have trouble seeing floss fund being unethical or in the wrong when we're talking about giving away money for nothing. Especially when the ask is just fill out the paperwork for a wire transfer, the world standard for sending money internationally.

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Don't think escrow is possible because of KYC requirements, then again the regulations in India might be different.
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Escrow is the wrong tool for the job anyway.
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> FLOSS Fund refused to follow the regulatory requirements to continue funding projects through Github, and Github dropped them as a funding source.

The email they sent to Pocketbase (posted elsewhere in the thread) makes it sound like the regulatory issue with GitHub funding is still being worked on. The email also doesn't sound like it ruled out the option to wait until the GitHub situation potentially gets sorted out in the future and simply recommended that they use a wire transfer to get things moving.

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Unethical ? "they want to issue a wire transfer, but I don't feel comfortable giving my IBAN"

If the IBAM is the concern you can create a separate IBAN with Wise / Revolut for example quite easily (and for free, and for sure cheaper than refusing the money).

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Here's the actual e-mail the fund sent:

Hey ******, I hope you're doing well. I apologise for the long delay on this disbursal from our end, and for not reaching out to you sooner.

I am writing to you with an update on GitHub Sponsors, your preferred mode of payment. Unfortunately, we're currently unable to process payments through GitHub Sponsors, Liberapay, OpenCollective, or similar platforms due to regulatory constraints. We still have no clarity on when this will become possible. We shared some context on this earlier here: https://floss.fund/blog/second-tranche-2025-anniversary/

We recommend that we move ahead with a wire transfer (although it involves some paperwork!). This involves:

1) Tax Residency Certificate (TRC) from your country of residence/incorporation for the current year.

2) Signed copy of the "No Permanent Establishment in India Declaration" (Template attached)

3) Form 10F to avoid double taxation for non-Indian entities and individuals. This is an online form that has to be filled out on the Indian Tax Department website. Instructions on how to fill it out are attached to this email. Please refer to this FAQ for more details.

4) Service Agreement – Please fill in the sections marked in yellow and send it back to us (Attached)

5) Invoice for the grant amount (sample attached with required fields highlighted, feel free to use your own invoice template if needed. Please mention "project development support" in the invoice description).

Once you have these, please send them over so that we can begin processing the payment.

Please note that these documents are required in our jurisdiction (India) for processing foreign payments. A percentage of the payment will be withheld as per the DTAA (Double-Taxation Avoidance Agreement) between India and your country, which the recipient can claim back while filing tax returns in their country. The specific withholding rate depends on the DTAA regulations between your country and India.

If you have any questions, please feel free to write to us.

Thank you once again for your patience

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These are perfectly normal requests .

These are needed to reduce withholding taxes and claim treaty benefits .

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Where did you get that email from?
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Looking at the required paperwork, I agree with Pocketbase to refuse funding.
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If you were already setup as a non-profit entity with 501c3 US taxes (or similar in other locales), this would be straightforward. Or, even if you were a for-profit company taking part with an LLC or other corporate structure. In those cases, you probably already have an accountant or tax advisor to help handle this stuff. For smaller individual level contributors, I can see how the extra paperwork and overhead could create enough of a hassle to make it not worthwhile. Which is sad.

It looks like the author here is from Bulgaria, so who knows what other hassles they would have on their side.

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Why? I don't see it as particularly onerous. They are simply complying with their country's KYC requirements. I've gone through worse to accept payments from US citizens with a US corporation. KYC/AML is annoying but its pretty unavoidable unless you want to do crypto.
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It's not really kyc . It's just standard procedure to claim Double tax treaty benefits.

You can look at the us W8-BEN

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invoice for fund disbursement? are they trying to donate as expenses?
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Most US companies take a tax deduction for charitable donations, I don't see why that wouldn't be the same for an Indian firm.
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No it's just that the Indian company is required to withhold taxes . But they want to use the double taxation treaty to claim benefits to reduce it
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Paying individual OSS contributors without a service agreement is not a charitable donation with regard to taxes. It's not a deductible business expense and typically leads to double taxation.
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That seems reasonable. It mostly looks necessary to comply with tax and banking laws.
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It's a wire transfer not your medical records. Use escrow if you are paranoid.
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