Money Transmitter Bond
A money transmitter is a business that offers money transfer services. A money transmitter bond is meant to guarantee the professional and honest rendering of services by businesses that offer money transmitting services. The bond helps in protecting the state in which the bond is issued and the public from any money transmitters who may have fraudulent goals such as withholding, stealing or misusing funds.
Money transmitter surety bonds are a requirement in most states. Federal law requires all money transmitter businesses to acquire a monetary transmitter license to operate legally. Check with your states department of finance or business licensing bureau for licensing and bonding requirements, or contact a member of the NF Surety team.
Who needs a money transmitter surety bond?
Businesses that offer money transferring or transmitting services are required to acquire a bond as part of the licensing process. Businesses that also offer payments from one business or person to another are required to have bonds for them to acquire licenses. These forms of business may include online merchants, wire transfer services, and money service businesses.
How do bonds differ by state?
Money transmitter bonds sometimes differ from state to state. There are some states that refer to money transmitter surety bonds using other names but they all serve the same purpose.
The businesses that need these bonds also vary by state. Businesses that deal in virtual currencies, for example, may need to get bonds to operate in some states but not others. In Connecticut, the HB 6800 bill is in place to address surety bonds for money transmitters that deal with virtual currencies. The commissioner under this bill has the power to set the bond amount for money transmitters.
The transmitters can also be charged with additional bonds. In the state of Utah, the SB 24 bill was introduced to regulate money transmitters in that state. The bill states that a $50,000 minimum surety bond should be imposed on all money transmitters.
The surety bonds should also be maintained for three years after the business stops operating in the money transmitting business. Kansas also revised its money transmission guidelines through the HB 2216 bill which increased the bond amount imposed on money transmitters from a maximum of $500,000 to $1,000,000.
Learn more about how you can get a money transmitter surety bond today. Our expertise and process makes all the difference.