How to Start a Money Transfer Business? Compliance & Law Tip!

How to Start a Money Transfer Business – Compliance & Law Tip! (The last point is the most serious. You cannot afford to screw up in this business when it comes to compliance and the law. Watch the video for more information).


Hello. My name is Faisal Khan. I’m a banking and a payment consultant and this is how to start a money transfer business YouTube series.

This is the last point we will be discussing prior to jumping into really how to start the business. The challenge this here is in the last point to think about something that is extremely important which is banking, license regulations and compliance.

A lot of people, a lot of calls that I get in my day to day life, you know, people are saying hey I want to start a money transfer business to Somalia to Ghana to Nigeria to Pakistan to India, Bangladesh, Vietnam, Kenya – you name it. And I asked him ‘Have you ever done this business before?’ No. So, I give them an easy exit. Also you know thank you. But I usually don’t deal with people, who have never done this business before. Some of them are the most of them never come back and that’s okay. But if they come back then I ask them have they reconsidered this. They say yes, we’ve reconsidered, they would really like to go into this business.

In this business, I want to make it very very clear to you. On a good day if you do something bad, on a good day, the regulators may just put a fine on you and give you a cease and desist notice. But, on a bad day you go to prison and the fines are very heavy.

Understand that if you try to get into the money transfer business and do something illegal, something that you say oh I didn’t know this was possible and the prosecutor comes after you on a bad day or rather on a regular day, you get to go to prison. There is no two ways about it. This is a very, very regulated field. It is one that moves a lot of money legally and one way criminals and fraudsters and all the other nefarious elements would love to get in to so that they can channel money and move it across.

So, do not be involved into something you don’t understand. It is extremely important that you hire the right compliance people or have partnerships with the right people or companies that provide compliance, who understand regulation, who understand the law, who have access to banking because these are the challenges that you will really face. Moving money is not that difficult. It is having access to banking. Finding MSB friendly banks that is going to be a huge challenge for you. It is finding the right compliance person who really understands the compliance not only in the original originating country, but also the beneficiary countries or countries where you would be operating. It is a huge challenge trying to find software and systems that are absolutely hand in glove with the compliance program that your company purchases or put out or what have you and going through audits and so forth. It’s a lot of paperwork. It’s a lot of procedures. It’s a lot of tests, lot of audits, lot of, you know, I don’t even know how to say, it’s a lot of minutiae details that have to be followed day in and day out. And there is no deviation from it.

And believe me there’ll be a lot of bad state actors who will be coming in to making sure, they try to disrupt you or find a loophole in your system so that they can find advanced, and take advantage of it. And that is something you don’t want to do.

So, banking, regulation, compliance and the law are something that is very very important in this aspect. Make sure you have the right partnerships, make sure you have the right alliances, and if you don’t or if you can afford them, do not enter the business.

This is the last point I wanted to hash out to you, maybe give you a breather, time to think about it and if you still want to go ahead and want to learn how to start a money transfer business, well you can continue with the playlist and I’ll keep adding more videos.

Till next time, take care.

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