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Difference between a money services business and a money transmitter license.

A money services business (MSB) is a term used by financial regulators to describe a type of business that provides certain financial services, such as currency exchange, money orders, and wire transfer services. MSBs are required to register with the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, and may also be required to obtain state licenses in order to operate.

A money transmitter license is a type of state license that is required for businesses that engage in the transmission of money or monetary value. This can include activities such as wire transfers, money orders, and the sale of prepaid debit cards. In order to obtain a money transmitter license, a business must typically apply to the state financial regulator and meet certain regulatory requirements, such as maintaining a minimum level of capital and having adequate anti-money laundering and consumer protection measures in place.

In summary, a money services business is a broad term that encompasses a variety of financial services, while a money transmitter license is a specific type of state license that is required for businesses that engage in the transmission of money.

This page was last updated on January 3, 2023.