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.
The bond ensures that the principle will abide by all laws stated in the Kansas Money Transmitter Act. All other related rules and regulations in Kansas must be followed with this surety bond also.
Since the Office of the State Bank of Kansas determines the bond amount, it is a good idea to check the bond amount with the obligee before applying for the bond.
This bond remains in full force until cancelled, so the obligee must be notified within 30 days of cancellation that the bond is no longer valid and being used.
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.)
Information that must be provided by the applicant on the application is as follows:
The applicant must have a minimum net worth of $250,000, as ordered by the state of Kansas.
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.
Money transmitters in Kansas must also register as a money services business (MSB) with the Federal Crimes Enforcement Network (FinCEN). The registration process must be completed by the Bank Secretary Act (BSA) e-filing system.