MSB Banking Requires More Than an Operating Account
Money services businesses and money transmitters are frequently evaluated differently from ordinary commercial companies because the bank is not only reviewing the company itself. It is also reviewing the flow of third-party funds, customer profile, transaction corridors, licensing coverage and compliance controls.
We help appropriately structured MSBs identify banking and payments infrastructure suited to their transaction model.
MSB Banking Infrastructure Components
Depending on the program, an approved MSB may require:
Operating accounts
Settlement accounts
Named or virtual accounts
FBO or pooled structures
ACH
Fedwire
SWIFT
Multi-currency balances
FX
International payouts
Local payout rails
Treasury tools
API access
Reconciliation infrastructure
What Providers Will Examine
An MSB should expect detailed review of:
State money transmitter licensing
Foreign MSB registration where applicable
Authorized-delegate or agent relationships
Transaction monitoring
Sanctions screening
Customer types
Flow of funds
Source and destination countries
Expected transaction volume
Average ticket size
Maximum transaction size
Funding methods
Payout methods
Source of funds
Beneficiary types
Example Flow
CUSTOMER
│
▼
COLLECTION RAIL
│
▼
MSB / LICENSED PRINCIPAL
│
▼
BANKING & TREASURY INFRASTRUCTURE
│
├── Accounts
├── FX
├── Compliance Controls
└── Settlement
│
▼
PAYOUT PARTNER / BANK
│
▼
BENEFICIARY
Licensed vs. Sponsored Models
Some companies operate under their own licensing.
Others participate through an authorized-delegate, agent or sponsored model where permitted.
The banking architecture has to match the regulatory structure. A provider that will support a fully licensed principal may not support an unlicensed technology company performing the same flow.
FBO and Pooled Accounts
Where customer funds are held in a pooled structure, banks typically require substantially more information.
They may need to understand:
Legal ownership of the account
Beneficial ownership of underlying funds
Customer-level ledgering
Reconciliation
Safeguarding
Funds segregation
Permitted transaction types
Compliance responsibility
What We Need Before Approaching Providers
We generally require:
Flow of funds
Transaction set
Licensing matrix
FinCEN registration
Compliance overview
Origination states
Destination countries
Monthly volume
Average transaction size
Funding methods
Payout methods
Required banking rails
Request an Assessment
If you are an MSB looking for banking, the fastest route is to begin with the transaction structure rather than a generic account request.