To obtain a money transmitter license, every state requires a surety bond. Depending on your state, this license may be called money remitter, money services business, check casher, or sales of check license.
A surety bond is made to protect the public. In basic terms, it guarantees your business will adhere to all laws and requirements in your industry. In the event your business conducts unlawful acts, a consumer of your services may file a claim on the bond.
Nearly any company that offers payment services requires a money transmitter bond. Due to a history of fraudulence and inaccurate money transmissions, state agencies now require this bond to protect consumers. While this bond does not protect the business owner, it offers proof that your business handles clients’ money responsibly.
The cost of the bond, the “premium,” depends largely on the bond amount and the applicant’s financial status. The state requiring the bond determines the amount. At Surety 1, we will find you the lowest quote for your bond, starting at only 1.5% of the bond amount.
In order to get your money transmitter’s business license, you’ll need a bond.
Before applying for a bond, the obligee should be contacted to make sure the bond amount the applicant will be applying for is correct. The bond amount is determined case-by-case, so the bond amount can vary by each applicant.
A surety bond is required so all money transmitters in Colorado will comply with Title 12, Article 52 of the Colorado Revised Statutes along with other Colorado state laws. Learn more at Colorado.gov.
These are additional details about the licensing process that you should be aware of. (Only the bond is handled at Surety1, but this information will help you get your license.)
Colorado requirements for the license application:
The license application can be filled out using an electronic system referred to as NMLS. Although, for businesses that are not conducting multi-state businesses or do not want to use the electronic application system can also have access to other application forms.
In addition, every transmitter must register at Financial Crimes Enforcement Network (FinCEN) through its BSA e-filing system. FinCEN is a part of the U.S. Department of Treasury. Registration with FinCEN is valid for 2 years.