Money transmitters, also known as money services businesses, are those who provide money transfer services on behalf of an individual or business. Because money is involved, there is an inherent risk for those utilizing money transmission services; therefore, there are regulations for money transmitters to prevent fraud. To receive and maintain licensure, a surety bond is required in 40 states. This article discusses who needs a Money Transmitter Bond, why it’s required, and other important bond details, such as the cost.
Who Needs a Money Transmitter Bond?
Any person or business that wants to be licensed to practice money transmitting inside the United States is likely required to obtain a bond, including the following:
- Wire transfer services
- Currency exchangers
- Electronic Money Transmitters
- Check cashers
- Sellers of traveler’s checks and money orders
- Cryptocurrency companies
Although the requirements are similar across the United States, it’s important to understand the regulations specific to your license and the state(s) you are transacting business in.
Why Are Money Transmitter Bonds Required?
In a general sense, surety bonds are required to provide a means of financial protection to the public. Money transmitters are mandated to handle the funds of their clients in an honorable manner while following the license rules and regulations. Should they fail to do so, restitution is readily available by filing a claim on the surety bond to correct any losses at the fault of the money transmitter. Fraud, withholding, theft, and misuse of funds are a few reasons why a claim would be filed on the Money Transmitter Bond.
To read more on the claims process, review the Money Transmitter Bond Claims Guide.
What Determines the Bond Limit and Cost?
The limit for a Money Transmitter Bond is determined by the financial institution that requires the license. Factors that impact the bond limit include the number of business transactions and the number of business locations.
The cost is directly correlated to the bond limit and the personal credit of the money transmitter. Rates start as low as $100 for one year.
How to Purchase a Money Transmitter Bond
You can obtain your Money Transmitter right here, with Jet! We have a super simple bond application process, only asking for the information needed to get you the best possible rate. You will provide payment for your bond premium from there, and you’ll be set! We will issue you a bond as soon as we have all of the information needed!
Click the button above to get right into the application, or read more detailed information on the state-specific requirements below:
Alabama Money Transmitter Bond
Arizona Money Transmitter Bond
Florida Money Transmitter Bond
Nevada Money Transmitter License Bond
North Carolina Money Transmitter Bond
Ohio Money Transmitter Bond
Oregon Money Transmitter Bond
Texas Money Services Bond
*Other states coming soon
If you have any questions in the meantime or require assistance with your application, call Jet at (855) 296-2663.