diff --git a/packages/contracts/script/DeployVaultFactory.s.sol b/packages/contracts/script/DeployVaultFactory.s.sol
index 909b91152..c23730108 100644
--- a/packages/contracts/script/DeployVaultFactory.s.sol
+++ b/packages/contracts/script/DeployVaultFactory.s.sol
@@ -45,18 +45,20 @@ contract DeployVaultFactory is Script {
 
         address owner = config.factoryParams.owner;
         address operator = config.factoryParams.operator;
+        address[] memory custodians = new address[](1);
+        custodians[0] = config.factoryParams.custodian;
 
         DeployedContracts deployChecker = new DeployedContracts();
 
         vm.startBroadcast();
 
         if (isTestMode || deployChecker.isDeployRequired("CredbullFixedYieldVaultFactory")) {
-            factory = new CredbullFixedYieldVaultFactory(owner, operator);
+            factory = new CredbullFixedYieldVaultFactory(owner, operator, custodians);
             console2.log("!!!!! Deploying CredbullFixedYieldVaultFactory !!!!!");
         }
 
         if (isTestMode || deployChecker.isDeployRequired("CredbullUpsideVaultFactory")) {
-            upsideFactory = new CredbullUpsideVaultFactory(owner, operator);
+            upsideFactory = new CredbullUpsideVaultFactory(owner, operator, custodians);
             console2.log("!!!!! Deploying CredbullVaultWithUpsideFactory !!!!!");
         }
 
diff --git a/packages/contracts/src/factories/CredbullFixedYieldVaultFactory.sol b/packages/contracts/src/factories/CredbullFixedYieldVaultFactory.sol
index e64d1f287..44819a5a3 100644
--- a/packages/contracts/src/factories/CredbullFixedYieldVaultFactory.sol
+++ b/packages/contracts/src/factories/CredbullFixedYieldVaultFactory.sol
@@ -10,8 +10,11 @@ contract CredbullFixedYieldVaultFactory is CredbullVaultFactory {
     /**
      * @param owner - The owner of the factory contract
      * @param operator - The operator of the factory contract
+     * @param custodians - The custodians allowable for the vaults
      */
-    constructor(address owner, address operator) CredbullVaultFactory(owner, operator) { }
+    constructor(address owner, address operator, address[] memory custodians)
+        CredbullVaultFactory(owner, operator, custodians)
+    { }
 
     /**
      * @notice - Function to create a new vault. Should be called only by the owner
diff --git a/packages/contracts/src/factories/CredbullUpsideVaultFactory.sol b/packages/contracts/src/factories/CredbullUpsideVaultFactory.sol
index 5ddc165e3..c9efa21bd 100644
--- a/packages/contracts/src/factories/CredbullUpsideVaultFactory.sol
+++ b/packages/contracts/src/factories/CredbullUpsideVaultFactory.sol
@@ -8,10 +8,13 @@ import { CredbullVaultFactory } from "./CredbullVaultFactory.sol";
 
 contract CredbullUpsideVaultFactory is CredbullVaultFactory {
     /**
-     * @param owner - The owner of the Factory contract
-     * @param operator - The operator of the Factory contract
+     * @param owner - The owner of the factory contract
+     * @param operator - The operator of the factory contract
+     * @param custodians - The custodians allowable for the vaults
      */
-    constructor(address owner, address operator) CredbullVaultFactory(owner, operator) { }
+    constructor(address owner, address operator, address[] memory custodians)
+        CredbullVaultFactory(owner, operator, custodians)
+    { }
 
     /**
      * @notice - Function to create a new upside vault. Should be called only by the owner
diff --git a/packages/contracts/src/factories/CredbullVaultFactory.sol b/packages/contracts/src/factories/CredbullVaultFactory.sol
index 681f729e3..959a55b3a 100644
--- a/packages/contracts/src/factories/CredbullVaultFactory.sol
+++ b/packages/contracts/src/factories/CredbullVaultFactory.sol
@@ -28,13 +28,19 @@ abstract contract CredbullVaultFactory is AccessControl {
     bytes32 public constant OPERATOR_ROLE = keccak256("OPERATOR_ROLE");
 
     /**
-     *
      * @param owner - Owner of the factory contract
      * @param operator - Operator of the factory contract
+     * @param custodians - Initial set of custodians allowable for the vaults
      */
-    constructor(address owner, address operator) {
+    constructor(address owner, address operator, address[] memory custodians) {
         _grantRole(DEFAULT_ADMIN_ROLE, owner);
         _grantRole(OPERATOR_ROLE, operator);
+
+        // set the allowed custodians directly in the constructor, without access restriction
+        bool[] memory result = new bool[](custodians.length);
+        for (uint256 i = 0; i < custodians.length; i++) {
+            result[i] = allowedCustodians.add(custodians[i]);
+        }
     }
 
     /**