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.
This bond type is continuous, which means it is in full force until it is cancelled. If the bond is cancelled, the principle must notify the obligee of the cancellation within 60 days before the effective date of the cancellation.
This bond guarantees the obligee will comply with the Seller of Checks Law in Chapter 217 of the Wisconsin Statutes along with other Wisconsin state laws. The bond will be revoked if the principle acts against the bond.
The applicant should verify the bond amount with the obligee before applying for the bond to ensure the bond amount is correct.
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.)
All license fees are required by the obligee, not the surety company.
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 Wisconsin 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.