Money Transmission Modernization Act (MTMA)
The Money Transmission Modernization Act is a model state law drafted by the CSBS to harmonize US money transmitter licensing — definitions, net worth, permissible investments and control-person rules. It has no force of its own; each state decides whether to adopt it.
Also called: Model Money Transmission Modernization Act · model law
The Money Transmission Modernization Act is drafted text, written by the CSBS with industry input for state legislatures to enact. It was produced because fifty separate statutes had drifted into fifty different answers to the same questions, and the cost of reconciling them fell on every applicant.
What it standardizes
The model covers the ground that generates most of the divergence: a common definition of money transmission and of the exemptions from it; net worth requirements scaled to activity; the list of permissible investments a licensee must hold against outstanding obligations; surety bond calculation; who counts as a control person and what a change of control requires; and a framework for states to examine a multi-state licensee jointly rather than one at a time.
What it leaves alone
Adoption does not merge anything. A state that enacts the model still runs its own application, sets its own fees, issues its own license and conducts its own supervision. Adoption is frequently partial: a legislature may take the definitions and not the net worth formula, or amend provisions during passage, or adopt an earlier version and not later amendments. The model also leaves untouched the parts of state law that sit outside it, so an adopting state’s older provisions on advertising, consumer complaints or examination fees carry on as before.
For an applicant the gain is real but specific. The same corporate facts can be described the same way in more places, which shortens preparation, reduces contradictory answers across a filing set, and makes it easier to predict what a new state will ask for. The number of applications does not fall, the fees do not merge, and a refusal in one state remains a refusal in that state alone.
In practice
It is a model law, not a federal statute. Each state decides whether to adopt it and how much of it to adopt, so describing somewhere as an “MTMA state” does not mean its rules match another adopting state’s — the enacted text has to be read as that state passed it.
Example
A licensee in three states brings in a new investor. Two of the states have adopted the model’s definition of control, so the same investment triggers the same change-of-control filing in both. The third has not, and applies its own older test — which may catch the investment, or may not, on facts the other two treat as irrelevant.
Commonly confused with
| Term | How it differs |
|---|---|
| CSBS | CSBS is the association of state regulators that drafted the model law; the MTMA is the text it produced, which only becomes law where a legislature enacts it. |
| Money Transmitter License | The MTMA shapes what a state asks for; the license is still the individual state’s own grant of permission. |
See also
- CSBSThe Conference of State Bank Supervisors, the membership organization through which US state financial regulators coordinate. CSBS operates NMLS, the system state money transmitter applications are filed through, and drafted the model Money Transmission Modernization Act.
- Permissible InvestmentsPermissible investments are the categories of asset a licensed US money transmitter may count against its outstanding money transmission obligations. Under the model law states have been adopting, the licensee must hold permissible investments worth at least the whole of what it owes customers, and the eligible list runs wider than cash and government securities.
- Money Transmitter LicenseA money transmitter license is permission granted by a US state for a company to receive money from the public in that state and pay it, or its value, to someone else. Each state licenses separately.
- Tangible Net WorthTangible net worth is net worth with intangible assets such as goodwill stripped out. US state regulators use it as the minimum capital test a money transmitter must pass to obtain a license and to keep it, and it is computed to the state’s definition rather than the company’s.
- NMLSNMLS, the Nationwide Multistate Licensing System, is the shared online system through which US state regulators accept, process and renew money transmitter and other non-depository license applications. One company record serves every state the applicant selects.
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Regulatory information checked: 22/Sep/2026