What Is an Arizona Money Transmitter Bond?
Money transmitters who do business in Arizona have to be licensed with the Arizona Department of Financial Institutions. One of the licensing requirements is posting an Arizona money transmitter bond.
The goal of your money transmitter bond is to protect state authorities and your customers from any unlawful actions you commit as a money transmitter. If you do break the rules, the bond provides financial compensation to affected parties.
The Arizona money transmitter bond functions much like other Arizona surety bonds. It’s a contract between three parties. The principal is your Arizona money transmitting business. The state Department of Financial Institutions is the obligee that imposes the bonding as a prerequisite to issuing your Arizona money transmitter license. The third entity is the surety, which provides you with the bond and backs your business.
Frequently Asked Questions
Who needs an Arizona money transmitter bond?
Any business who wants to conduct money transmitting in Arizona needs to get bonded in order to obtain a state license from the Department of Financial Institutions. The bond ensures they will comply with applicable Arizona Statutes, and protects customers. Applicants have to use the official surety bond form when submitting their applications for an Arizona money transmitter license.
How much do I have to pay for an Arizona money transmitter bond?
The bond amount that Arizona money transmitters have to post is set by the licensing authority, with a minimum amount of $25,000. Before you start your licensing process, make sure to verify the requirements that apply for you.
The bond price you have to pay is not the same as your bond amount. It’s called the bond premium, and it’s usually between 1%-5% of the bond amount. This means that for a $25,000 bond you may pay as low as $250-$1,250.
|Bond Type||Surety Bond Amount||Credit Sore|
|Above 700||Between 650-699||Between 600-649||Below 599|
|Arizona Money Transmitter Bond||(Minimum Amount) $25,000||$188-$375||$250-$750||$625-$1,250||$1,250-$2,500|
When you apply with a surety, it needs to take a close look at your personal and business finances. It considers factors such as your personal credit score, business finances, and assets and liquidity, in order to judge how risky it is to get you bonded. Your bond price is likely to be lower if your overall financial status is solid.
Need more details about the way your bond price is set? Consult our surety bond cost page for further information.
Can I get an Arizona money transmitter bond with bad credit?
Even if your finances aren’t perfect, you can still get the Arizona money transmitter bond you need. Lance Surety Bonds offers its Bad Credit Surety Bonds program for applicants with low credit scores, tax liens, bankruptcies, and civil judgements.
You can expect bonding rates in the range of 5% and 10%. As the bonding risk is higher, the bond price compensates for it. We work with a number of A-rated, T-listed surety companies, so you are guaranteed a low rate. We can choose the most appropriate bonding option that matches your circumstances.
How do I get bonded?
Want to start your bonding process? You can apply online for a free, no-obligations Arizona money transmitter bond quote today. If you want to know your exact bond price, go ahead and submit your full application and paperwork. We will deliver it to you in no time.
If you need more information before you apply, make sure to check out our How to Get Bonded page, for a complete run-down of how the bonding process works.
Still have questions? Don’t hesitate to call us at (877) 514-5146. Lance Surety Bonds’ experts will be happy to help you!
How are bond claims handled for Arizona money transmitters?
Your surety bond does not protect your money transmitting company. Instead, it safeguards the interests of your customers. If you knowingly transgress from your obligations as set in the Arizona Revised Statutes, Chapter 12, you can face a bond claim.
On proven claims, you’re obligated to reimburse affected parties up to the penal sum of your bond. Your surety covers all expenses at first, but you have to repay it in full. This means that bond claims can harm your business financially, and they prevent you from getting bonded in the future.