Starting in May, money transmitters will need to comply with a few changes to Arkansas’ license requirements detailed in Senate Bill 187, which passed on Feb. 13.
The now called Act 111 amends the Uniform Money Services Act, introducing changes that include a reworking of the surety bond amount required to remain licensed with the Arkansas State Board of Collection Agencies.
Before the act, money transmitters were required to submit a surety bond of $50,000 plus $10,000 per location in Arkansas where the applicant and its authorized delegates transmit money or provide other money services must be included with the application for a money services license. The maximum required amount of the surety bond was set at $300,000.
Now, the new minimum will be $10,000 with the same maximum of $300,000. The amendments to the act also state that licensee will maintain a surety bond in an amount based on the previous year’s when it comes to money transmission dollar volume, payment instrument dollar volume and stored value dollar volume.
It also states that the commissioner may set specific required bond amounts by rule.
The license must now be renewed annually with a fee of $375 no later than Dec. 31 in order to be licensed for the next year. The act previously stated that the licensee had to pay a biennial fee of $750 no later than Dec. 1.
The act states that if “a licensee has not renewed a license within 30 days of the renewal date and has not shown good cause to receive an extension… then it shall be necessary for the licensee to submit a new application to engage in the 14 business of currency exchange.”
What is a money transmitter?
A money transmitter is a business that engages in receiving money from one consumer or business and transmitting it to another consumer or business. The method of transmission includes electronic transfers, wire transfers, and payment instruments like traveler’s checks.
What is a money transmitter bond?
A money transmitter surety bond is a license and permit bond required by certain government jurisdictions. This bond will also ensure the consumer is financially covered by a third party in the case the money transmitter commits any fraud or other criminal activities. These bonds are also known as check seller bonds.