Canada money service business

Businesses that deal in money services offer currency conversion and exchange services to businesses all over the world.

Financial institutions are classified as “Money Services Businesses” if they transfer or convert money (MSB). The term Canada money service business now refers to a wide range of organisations, including those offering crowdfunding, e-commerce, and cryptocurrency products. While they offer some of the same services as banks, MSBs are not banks. Instead, they are commercial product providers who offer a variety of cheaper, more diverse options to anyone looking to convert or transmit money.

Canada’s financial system is regarded as one of the most dependable in the whole globe. The ninth largest economy in the world is currently the only one that satisfies all the requirements, including those for property rights, technology, innovations, taxes, levels of corruption, the state of the securities market, bureaucracy, and investor protection, having survived the global crisis.

In Canada, banks and payment systems both have a significant impact on the financial industry. To expand the financial industry, the Canadian government imposed rather strict regulations for businesses planning to offer financial services, drawing both domestic and foreign investors.

Purpose of (MSB) Licence-

The MSB is a non-bank financial entity that is authorised to engage in the following financial activities: 

  • Currency exchange services;
  • offering services for money transfers;
  • issuing or redeeming bank charges, traveller’s checks, or money orders;
  • cashing checks;
  • ATM operation includes renting out commercial space for an ATM site if the lessor is in charge of the bank’s cash supply;
  • Deals in virtual currencies.
  • You must be aware of all your responsibilities if you work for the Canada Money Services Business (MSB). 

This involves establishing a compliance program, knowing your customers, reporting, maintaining records, and registering your firm.

The following are the primary conditions for establishing a Canada money service business firm:

You must register your firm with FINTRAC (Canada’s Financial Transaction and Report Analysis Centre) to operate your money services business there:

  • Applications must include the following paperwork:
  • Details about a bank account
  • corporate records
  • Operational location
  • Information in-depth about the owner and top management
  • Policies and procedures for compliance
  • details on training initiatives
  • Workforce size and organisational structure

Compliance initiative

The foundation for fulfilling all of your responsibilities under the PCMLTFA and related Regulations is a thorough and efficient compliance program. It is crucial to show during a FINTRAC investigation that all necessary paperwork is in place, that all employees, agents, and other people with permission to act on your behalf are properly trained, and that they are capable of implementing all the components of your compliance program. The compliance program must be approved by a senior officer, and the compliance officer must have the required power to carry out the program’s obligations.

Rules for Fintrac

Only domestic money service firms are now covered by the PCMLTFA (Proceeds of Crime Money Laundering and Terrorist Financing Act) in the context of the applicant’s business services. The Government of Canada acknowledges that there is no regulation for companies that offer foreign exchange services and companies that deal in virtual currencies in the Regulatory Impact Analysis Statement for the PCMLTFA’s proposed modifications (“Proposed Regulations”). Whether the applicant forms a head office in Canada and becomes a domestic money service company (“MSB”), or whether the applicant waits until the proposed regulations to control international money service firms are implemented.

Offshore assists with the full licence application. Please contact us by phone or email if you are still interested in starting a Canada money service business.

Our team of professionals is happy and prepared to help you and will answer any questions you can have and clarify any issues you can require.