FAQ: Money Transfer & Remittances

  1. I learnt the concept of FBO/ Omnibus account/ Pooled account, so considering our models, how can we charge our service fee (let’s say 2% of the transaction amount) on behalf of our merchants (since we cannot touch the fund)?
  2. If we go for the Operator Led Model, are we qualified if we request to be connected to MSBs in Asia & other regions?
  3. Can you connect us with the MSB in Southeast Asia in order to act as the MTO in our models?
  4. I misunderstood the Operator-Led model. Can you please explain again?
  5. As the Operator Led participant, we can open an EUR IBAN account for processing transactions (which means we can access/install a payment application (provided by the EMI holder) for sending/tracking transactions). So when a customer agrees to use our service, they will send EUR to our IBAN account, is it correct?
  6. In order to be competitive, a payment option by credit card (beyond ACH and Debit Card) would be a great addition. Why is this not offered?
  7. On your website, it is mentioned, “e-Wallet solution (stored Value)- does not imply that a software wallet is provided. That is optional and comes under iOS & Android App or White-Label Website”. Can you please provide more details on this?
  8. Would the PLH be entitled to any revenue for intra-Africa (with no tie up agreements necessary) with or without the usage of the SP’s platform?
  9. Since our company is about to obtain a Labuan Money Brokering license, may I know whether it is sufficient to use this license to apply to be a Registered Agent (RA) under an EMI holder?
  10. Can you give some examples of additional services not offered by the Principal License Holder?
  11. Will the license holder assist us with the process, or do we have to consult some law firm, or your team? If we have to seek consultation, what is the additional cost of it (a rough number is fine)?
  12. Can you please explain if there is a pricing difference (lower cost) between: 1) Option to BYOBB/BYOMTO (Bring-Your-Own Beneficiary Bank / Bring Your Own MTO) 2) Manage our own FX Handling (Optional)
  13. What will be the cost if we will develop our App and Web and just pure API integration?
  14. How much is start-up and monthly cost and is there a Revenue sharing model?
  15. What is the breakdown of monthly recurring costs for RaaS and is there a minimum monthly cost?
  16. How competitive is the daily FX offering?
  17. How robust is the Payout Model for PHP?
  18. What are the Licensed MSB options we will affiliate with? (The ones who own the remittance platform, Compliance and Card/ACH Payment Gateway)
  19. Your fee for new US MTL applications is very high. What do you provide in this service?
  20. We have established a money transfer company in Canada and now we are looking for a bank in the US and want to be its Authorized Delegate in the USA for money transfer services.
  21. Our understanding was that the UK/EU integrations could be possible in Q4 2021, kindly confirm if this understanding is correct.
  22. Is Faisal Khan the principal license holder or a sublicensee and solution provider (in the case of US as well as the UK/EU rollout)?
  23. Can we fix the rate entirely throughout the chain till the beneficiary? What role does your company play in the FX rate fixing?
  24. Have you prepared the pricing for the UK/EU subscription? (including all cost components affecting the unit transaction costs?)
  25. What is the status of the UK-EU RAAS program rollout?
  26. If we do not intend to establish a company in the US, due to the regulations, taxes, etc. Is it possible to continue to operate from Ecuador, with payment and correspondent agreements given that we comply with all regulations in Ecuador?
  27. Since your company only contacts, arranges, and opens the door to negotiate; is it possible to negotiate with the company willing to work with our company? What happens if an agreement is not reached on the issue of prices or for any other issue? Is the payment for your services reimbursed 100%?
  28. For us to be able to commit about +/-$10,000 to 20,000 with your “Starter” plan, are the costs in the examples you gave only examples, or are they actual costs?
  29. Because it is the fastest way in terms of cost/benefit/time, you make contact with a Bank or an MSB company, which allows us to operate a digital remittance platform? And, do you also provide the legal compliance service?
  30. In summary, there are 3 ways to enter the remittance market in the US, 1) obtaining your own licenses, 2) through an agreement with a company that has the licenses to operate (this is the way we currently work), and 3) operating a digital platform where the whole process is done by the MSB, and we never touch the funds. Is this correct?
  31. Would our company be an agent of the sponsor? I’ve read a lot of jargon about the agent relationship; could you please elaborate on this a bit.
  32. Montana does not require a money transmitter license, so if I register a company there am I exempt from money transmitter licenses?
  33. Do Trust Companies provide money transmitter license coverage?
  34. Our company is currently structured as a Delaware C-corporation. Will this present any issues? Is there a standard entity type a ‘sponsoree’ would be more likely to choose?
  35. How long does it take to find a sponsor, finalize a contract, and get up and running?
  36. A medical company in Venezuela requires $50,000 cash for its payroll; they wire us $50,000 in Florida, and we give them $50,000 cash in Venezuela minus the fee. Do we need to set up a correspondent tie-up agreement for such transactions?
  37. Can we use your RaaS offering for B2B?
  38. Can a company registered in Barbados as a licensed MSB operate (send/receive money) from/in Florida?
  39. What is the difference between Reserve and Pre-funding under Balances & Reserves?
  40. We noticed that the credit card processing is at 2.09% for the starter plan. Can we bring our own card processor if we have one?
  41. Is nationwide US state coverage guaranteed?
  42. If I start on the smaller plan like Starter and then upgrade to Pro? How does that happen?
  43. Can I use an aggregator on the Starter plan and use the aggregator to payout to multiple countries (more than the allowed number)?
  44. Ria Money Transfer is beating the pricing structure you have listed on your website. This means I pay no more than $3-$4 when sending by bank account to India. What do you say about this?
  45. What is the current ongoing rate of the dollar you offer for Euro (CFA) Cedi, Naira through your scheme?
  46. RIA is competitively charging low fees, and the only way we could match up would be to find a payout partner with a good rate. Your solution is turnkey, which is good, but, we need visibility into the rate (assuming you will be assigning a payout partner to us) so that we could do some quick calculations before investing in your solution.
  47. Why is the flow of funds important and why must I make it? Why can’t you make the flow of funds based on our project’s understanding (as you comprehend it)?
  48. Do aggregators have to be approved and if so, how long does that take?
  49. Can we start with our Mauritanian company?
  50. Do you provide a settlement wallet/account?
  51. What bank will we be signing with? Can you tell us the name of the financial institution you are talking to? We might already be in conversation with them?
  52. Regarding the API we have a vendor that helps with Tech Support. We will work with the bank directly to develop our back end. Does the licensed financial institution provide an API?
  53. Is approval by a solution provider (i.e. licensed financial institution) guaranteed?
  54. What is the time frame to get approval from the solution provider?
  55. For your one-time consultation (referral) fee could we ask you for a break on it?
  56. What is the original $25,000 fee for?
  57. Why do we have to pay you (Faisal Khan, LLC) the monthly fees for banking and why not the bank?
  58. When is the referral fee due? Is it due once we are connected to a financial institution and an account has been opened with them?
  59. Does the armored car service need to have a contract with your bank?
  60. Are armored carriers allowed to pick up cash from Bitcoin ATM Operators and deposit it into their vault account and then transfer it over to our account?
  61. What is my company’s role defined in all of this? What role do I play as a non-licensed entity?
  62. How do I tell the payout partner in my beneficiary country to have a correspondent tie-up with the solution provider?
  63. Who will be in charge of ID verification process or KYC process? Will it be me or someone else?
  64. I will be happy to pay a bigger reserve or something like that if we can have the limits raised to 5K, as only WorldRemit and Western Union offer those limits and that is the kind of company I want to have in the future if everything goes well.
  65. How can there be fraud in the money transfer business? I don’t know about the business and want to know if it comes with some kind of chargeback or fraud protection for us.
  66. After we launch, can I increase the ACH limit to suit my client’s needs?
  67. Let’s say that I start the business, what would be my role in it? Will I be in charge of the back office?
  68. Do I have to hire staff for my money transfer business?
  69. Who is in charge of authorizing the transactions? Will it be me or someone else?
  70. If I have a starter package, how much do you think I need to have in my budget to have everything operative in the shortest amount of time? Please give me an estimate.
  71. Which service plan do you recommend for a startup company to start with? Is it possible to choose the Starter plan now and upgrade later?
  72. Who does the ID verification? Do I have to hire a third-party company for this, or is it included in the software?
  73. What is the minimum and maximum amount that a client can pay using a debit card? Also, what is the minimum amount that a client can send using ACH?
  74. What does a Good Funds & Settled Model mean?
  75. In a correspondent tie-up, who sets the FX rate and who gains from it?
  76. Can we operate on a good funds & settled model?
  77. Are B2B (Business to Business) transactions allowed? Can we make use of intermediate MNO’s?
  78. Can the daily transaction limits be increased by increasing the reserves? If yes, how long does this process take?
  79. Can I use my own payment processor?
  80. Which payout countries are available currently?
  81. Is it possible to send money outside the USA?
  82. Can I send money to a third country like China or Europe?
  83. Can we use PayPal, Square Cash, Venmo, Zelle, etc. to collect money?
  84. Would a US Bank Account (Nostro) via Fedwire be held in a foreign country? Would that be classified as Nostro accounts?
  85. Can we operate on a funds good & settled model? Please clarify steps of responsibility in the flow of funds.
  86. Can we increase our deposit for the RAAS service starter package?
  87. What happens under a RaaS program when you want to use a specific provider in the beneficiary country?
  88. Can my company be incorporated outside the United States, even though the RaaS we want is from the US?
  89. Is there a special type of company we need to form in order to be able to do Remittance-as-a-Service?
  90. How much does the Remittance-as-a-Service (RaaS) cost?
  91. Barring your referral fees, realistically what is the most minimum amount we can start a money transfer business with?
  92. How much money would I need to start a RaaS business?
  93. In Remittance-as-a-Service (RaaS), will I just need to give you our branding and be ready to launch?
  94. How much commission do you charge for finding a service provider for remittance-as-a-service?
  95. How many beneficiary countries can I have?
  96. Is an API provided for?
  97. Who is responsible for anti-money laundering?
  98. Do I have to use their technology? Can I not use my own?
  99. How will I compete with others in the market?
  100. Why do I have to put up the pre-funding money?
  101. Is it possible to get the interbank (mid-market rate)?
  102. Why do the rates vary for the Starter package versus the Enterprise package?
  103. Is there a discount for startups?
  104. How long does Remittance as a Service take to be up and running?
  105. If we are a licensed money transfer company with extensive agreements with the payout countries, will the principal license holder agree to sign an agreement with us?
  106. Do you provide access to banking for Remittance-as-a-Service (RaaS)?
  107. Is nationwide coverage guaranteed?
  108. Can I increase the number of payout countries while opting for the Pro or Starter package?
  109. Can you give me more details about payment (payout) countries?
  110. What are the solution providers payout rails? How can we find out their commercial terms and delivery times for the pay out countries?
  111. With a US sponsored solution provider for Remittance-as-a-Service, would we also be able to use Europe as sending corridors?
  112. As a fresh startup, what is the probability of being sponsored by a bank or an exchange company?
  113. What would the service provider charge for a ready made solution (Web and Mobile Application)?
  114. I want to get into the remittance business for Nigeria – how do I get started?
  115. Can I quickly hop on a call with you and learn how to setup a money transfer business?
  116. Can I initiate a transfer without having the money flow through a bank I own?
  117. What is a list of reasonable payout countries that we can get access to by the solution provider when we are setting up our money transfer business?
  118. Is there a list of reasonable countries that we will get access to?
  119. What is the timeline before we can go live?
  120. Can I write “To be determined” or “To be negotiated” in the Term Sheet Consideration?
  121. How can you tell if the balance being converted to cash is from a credit card, a debit card, a gift card, or a prepaid card?
  122. Other than the receipt, are there other methods to see whether cash was deposited into the gift card or not?
  123. How long does it take for funds to process for my clients?
  124. How long does the leasing period last?
  125. Is it possible to go live within 6-8 weeks after the initial engagement?
  126. Will I have access to ACH transfers?
  127. What is the timeline to send money out?
  128. Have you successfully brokered MSB accounts in 2020, and are they now banked?
  129. Do we need to hire a full-time compliance officer?
  130. Does your price quote cover the complete plan of Partnership License acceptance and execution?
  131. Would we receive proper installation/onboarding support for the API once we choose a solution provider?
  132. How do you determine which gift cards have been issued in the United States and/or which store has issued them?
  133. How long does it take to transfer the money from a gift card to our bank account?
  134. Is it possible for you to hold the funds in case I want to get them transferred to a different account?
  135. What is the timeline followed by your company after you accept a potential client?
  136. What does it mean to acquire a Money Transmitter License (sponsorship)?
  137. Once I sign the referral agreement, what should I expect next?
  138. What is the timeline to pay the referral fee?
  139. With regards to me as the owner of the business, how many departments do I need to run this (remittance as a service business) successfully?
  140. Are they (the principal license holder) going to hold some money? For example, if they got 100% from the customer, do they hold to the funds or will they release it all?
  141. Before we sign with your company, are there any reference projects we can see to help us make a decision?
  142. Is there a monthly fee charged by the Principal License Holder?
  143. Is there any monthly fee if I avail Remittance As A Service?
  144. Do you have any list price for regulatory coverage for each US state to help us pick our “Must-have States”?
  145. Once we are ready to sign and go ahead, how long does it take for the contract to start?
  146. How many days will the owner of the license take to make a deposit (liquidation of the money) in my clients bank account?
  147. Who sets the forex rate ? Is it the principal license holder or me as the business owner?
  148. What is the best way to present our use-case to the partner?
  149. What happens if we decide not to move forward with the agreement?
  150. What is the rate for your services?
  151. What criteria distinguishes an MSB from an FMSB?
  152. Is a License Necessary to Start a Money Transfer Business?

This page was last updated on February 22, 2023.

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