Speaking to the BBC's Andrew Marr Show on Sunday, Banks said the money had all been from his UK-registered firm.
At stake is whether Banks and his associates broke election law to secure a narrow victory for the Brexit campaign.
He told Sky News: "The £8m came from a United Kingdom company, the cash was generated in the UK".
Bob Posner, the Commission's director of political finance, said: "We have reasonable grounds to suspect money given to Better for the Country came from impermissible sources and that Mr Banks and Ms Bilney, the responsible person for Leave.EU, knowingly concealed the true circumstances under which this money was provided".
Banks said in a statement that he has never received any foreign donations.
This would have made it an "impermissible" source of money under United Kingdom electoral law. "He said he was 'confident that a full and frank investigation will finally put an end to the ludicrous allegations levelled against me and my colleagues".
He replied: "What I said was that the corruption I have seen in British politics, the sewer that exists and the disgraceful behaviour of the government over what they are doing with Brexit and how they are selling out, means that if I had my time again I think we would have been better to probably remain and not unleash these demons". The question is where did the money come from?More news: Winx jockey Hugh Bowman Melbourne Cup runner-up Marmelo banned for a month
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"The money came from Rock Services which was a United Kingdom limited company".
Pressed on how Rock Services could generate the £8m when it is listed as a non-trading company, Banks said the cash came from the insurance business of Rock Services and that all Leave funds were generated by UK-listed companies.
Banks said: "I can say that was reported to the Electoral Commission and people who did work for Eldon were transferred over on short-term contracts legally and it was reported through the Electoral Commission in the right way".
One of the self-styled "Bad Boys of Brexit", Mr Banks has disclosed how he enjoyed a "boozy lunch" with the Russian ambassador in 2015, which preceded further meetings.
Mr Banks denied any business links with Russian Federation as he stated he is "not going to apologise for having lunch with a diplomat, I've had lunch with many diplomats". "You know, we're going to co-operate with the NCA and they'll have visibility into our accounts".
Banks, along with Leave.EU, Better for the Country (BFTC) and another senior campaign figure, Elizabeth Bilney, were referred to the NCA, Britain's equivalent to the Federal Bureau of Investigation, by the Electoral Commission.
The Electoral Commission is not responding to Mr Banks' comments.