Michigan Money Transmitter License: Full Guide [2020]

Published: Apr 27, 2020
michigan money transmitter license

 

Are you thinking about starting a money transmitting business in Michigan? If you’re considering this endeavor, the first step that you need to take is to obtain a Michigan money transmitter license. 

The licensing authority in the state is the Michigan Department of Insurance and Financial Services. It determines the requirements that you have to satisfy in order to receive a license. The actual procedure is handled via the website of the Nationwide Multistate Licensing System and Registry (NMLS). 

You can get acquainted with the details about the licensing in the guide below. 

Meet the Michigan Money Transmitter License Requirements

The Department of Insurance and Financial Services sets the criteria that you need to fulfill. They guarantee you are a suitable candidate for conducting money transmission services in the state. 

Business Documents 

The first step that you have to take is to register your business entity in the State of Michigan. The formation documents have to accompany your license application.

The rest of the documents that you need to provide include: 

  • Trade name (if applicable) 
  • Business plan
  • Organizational chart
  • Management chart
  • Resident/Registered Agent information
  • Primary contact employees information
  • Disclosure questions
  • Control Person (MU2) attestation 
  • Qualifying individual information
  • Certificate of Authority/Good Standing Certificate
  • FinCEN registration confirmation number
  • Your Anti-Money Laundering (AML) / Bank Secrecy Act (BSA) policy
  • Flow of funds structure
  • Company owned locations/branches
  • Direct ownership verification
  • Precautions planned for conducting internet business

You can check out the full list of requirements on the NMLS website

Provide a Surety Bond 

One of the requirements that you have to satisfy to get a Michigan money transmitter license is to post a surety bond. The Michigan money transmitter bond serves as an extra level of protection for your customers. It guarantees that you will follow all applicable laws in your operations, such as the Michigan Money Transmission Services Act

The bond amount that you have to provide depends on the number of locations that you wish to operate. For the first location, you need a $500,000 bond. You have to increase the amount with $10,000 for each additional location. The maximum bond amount that you may have to supply is $1,500,000.

In order to get bonded, you have to cover only a premium. It constitutes a small percentage of the required amount. The factors that shape it include your personal credit score, business finances, and any fixed and liquid assets that you can demonstrate. If these factors are stable, the typical rates you can get are between 0.5% and 5%.

Want to see the exact price of your Michigan money transmitter bond? Fill in the short form below! 

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Financial Statements

You have to provide your financial statements for the last two years. They have to showcase that your company has a minimum net worth of $100,000, plus $25,000 for each additional location or authorized delegate, up to a maximum required net worth of $1,000,000. 

Complete the Michigan Money Transmitter License Application

michigan money transmitter licenseWhen you have obtained all the necessary paperwork required for your application, you have to submit your complete package online to the NMLS. 

Some documents have to be mailed directly to the Department. For them, use the following mailing address:

Department of Insurance and Financial Services 

Consumer Finance Section 

P.O. Box 30220 Lansing, MI 48909-7720

License and Registration Fees

The applicable license and registration fees that you have to cover include:

  • $600 application fee
  • $3,050 license fee
  • $50 license fee for each additional location 

 

Have further questions about getting your Michigan money transmitter license and bonding? Don’t hesitate to contact us at 877.514.5146

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Robin Kix

Robin Kix

Robin Kix is currently the Renewal Department Manager. Since joining Lance Surety in 2014, she has helped thousands of businesses throughout the nation remain compliant at the federal, state and local level. She has significant experience supporting commercial bond lines, particularly in the automobile, transportation and construction industries. Robin and her team work together to create a positive customer service experience at the time of every policy renewal, whether that be finding the best pricing or offering additional assistance.