What does remittance-as-a-service mean?
Remittance-as-a-Service means that everything is outsource to a licensed financial institution that has the necessary money transmitter licenses and provide all the facets of running a legal money transfer business in the US. This includes licenses, banking, payment processing, compliance, AML, KYC, reporting, transaction monitoring, settlement, payouts, etc.
Please watch this video: So You Want To Start A Money Transfer Service? (Remittance-as-a-Service)
What is the downside of Remittance-as-a-Service?
The downside if you will, is that the customer legally belongs to the principal license holder (PLH). Barring personal information like DOB and SSN, you can contract with the PLH to provide you with the customer data, i.e. share it with you. The other downside is the rates. Needless to say there is an intermediary party providing you a service, so the rates are higher than what they would be had you been a direct owner of the license yourself.
What does it mean when it says $2,000 monthly minimum? What is this minimum for?
Please refer to the earlier explanation given here. The monthly minimum is the guaranteed business for the ACH / Card Processors. Due to the nature of remittances as being classified as high-risk, the processors after they underwrite you, would like to have a minimum viable business guarantee from you. This is why they impose a minimum monthly commitment to you.
This page was last updated on December 28, 2020.