California Money Transmitter License Guide

In California, a Money Transmitter license is required from any entity engaged in money transmission activities, as well as any entity that issues and sells payment instruments, travelers checks, and non-bank issuers of stored value.

Money Transmitter licenses are regulated and issued by the California Department of Business Oversight (DBO) - Money Transmitter Division . New license applications are handled by the Nationwide Mortgage Licensing System (NMLS) .

You can access all applicable forms online via the California NMLS page .

• The CA Money Transmitter license application checklist is available here .

The Department of Business Oversight encourages applicants to arrange a pre-filing meeting with Money Transmitter Division staff to clarify any questions regarding the application process and regulatory requirements. To schedule an appointment, you may contact Julio Prada at julio.prada@dbo.ca.gov or (415) 263-8540, or Oscar Lumen at oscar.lumen@dbo.ca.gov or (415) 263-8577.

• Company Form (MU1): When applying through NMLS, the MU1 form serves as the application for the Money Transmitter license. The following requirements must be submitted electronically via NMLS.

• Financial Statements: A financial statement, including income statement, statement of cash flow, balance sheet, and any other relevant notes. The financial statement must be dated within 90 days of the applicant’s fiscal year end.

• Authorized Agents (Delegates) Locations: Once your application is approved, submit a list of agents (delegates) who are authorized to engage in money transmission business in CA on your behalf. Upload this list using the NMLS Uniform Authorized Agent Reporting functionality .

• Other Trade Name: If applicable, list any names (other than your legal name) that you operate under. For each trade name, upload an endorsed copy of your fictitious business name statement.

• Registered Agent: List the registered agent under this section of the MU1 form.

• Primary Contact Employees: List your primary company contact and your primary consumer complaint contact.

• Approval and Designation: If applicable, provide your FinCen registration confirmation code and filing date.

• Bank Account: Provide bank account information for the primary Line/Letter of Credit, Operating, and/or Trust Primary accounts used by the company for conducting money transmission business in CA.

• Disclosure Questions: For each “yes” answer (made by the company or a control person [MU2]), upload a document including complete and detailed explanations.

• AML/BSA Policy: Submit an Anti-Money Laundering/Bank Secrecy Act policy, including the most recent independent review. The AML/BSA policy must include a detailed proposition on how the applicant will comply with state/federal AML/BSA laws and regulations, as well as how electronic data processing technology will be utilized to record and maintain information.

• Business Plan: Provide a detailed description of your business plan.

• Certificate of Authority/Good Standing: Submit a Certificate of Authority of a Good Standing Certificate issued not more than 60 days prior to the NMLS application filing. The certificate must be a state-issued and approved document.

• Document Samples: Upload a copy of the applicable sample document (in connection with the Money Transmitter license):

  • Receipt for money transaction received for transmission

  • Payment instrument or instrument where stored value is recorded

• Flow of Funds Structure: Provide a step-by-step description of each type of service or transaction to be conducted by the company.

• Management Chart: The chart must show the applicant’s directors, managers, and officers, as well as identify compliance reporting and internal audit structure.

• Organizational Chart/Description: Upload an organizational chart displaying/describing the ownership percentage of direct and indirect owners, subsidiaries, and affiliates of the applicant.

• Control Person Attestation - MU2 Individual Form: The completed MU2 form must be attested by the relevant control person prior to submission, along with the Company MU1 form.

• Credit Report: Each individual in a position of control must authorize a credit report via NMLS by completing an Identity Verification Process (IDV) along with an individual attestation. The credit report authorization is completed when the MU2 (individual) form is submitted with the MU1 (company) form.

• Documents Submitted Outside of NMLS: The following requirements must be mailed directly to the Department of Business Oversight (DBO) - Money Transmitter Division:

• DBO Forms: Applicants are required to complete and submit the following forms: DBO Form 5025, DBO Form 2, DBO Form 550, and DBO Form 4030. The forms are available via DBO on the Money Transmitter Forms page .

• Board Authorizations: Upload a copy of the authorization resolutions via the applicant’s board of directors.

• Banking References: Submit at least two banking references.

• Branches and Agents Information: Provide an estimate of your prospective agents and branches in California by the end of your first, second, and third operation year.

• Selection and Supervision of Agents Information: Provide detailed description of your policies, procedures, and responsibilities, as well as authorities of key personnel.

• Pro Forma Financial Statement: Submit three years of pro forma statements of income, pro forma balance sheet, and average daily total liability projections for CA.

• Financial Statements: Provide a certified copy of the applicant’s audited financial statements, unconsolidated financial statements (for the current fiscal year), and balance sheet income statement. Applicants who are publicly traded by a wholly-owned subsidiary of a corporation may be required to provide further documentation.

• OFAC Compliance Information: Submit a detailed description on how you propose to comply with the Office of Foreign Assets Control (OFAC) laws.

• Fingerprints and Background Checks: Fingerprints and background checks are required of executive officers/directors, individuals who own/control at least 10% of the applicant’s voting shares, and individuals who own/control at least 10% of the voting shares of entities which control the applicant.

• Control Persons Residing in Foreign Jurisdictions: A background report is required for any control person who does not – or has not – resided in the United States for at least 10 years.

All CA Money Transmitter license applicants are required to upload a surety bond via NMLS. The bond must be issued by a company authorized to conduct business in California.

Licensees who sell or issue payment instruments are required to furnish and maintain a bond of either: a minimum of $500,000 or 50% of the licensee's average daily outstanding payment instrument and stored value obligations – whichever is greater. The bond amount should not exceed $2,000,000.

Licensees who engage in receiving money for transmission are required to submit and maintain a bond in an amount greater than the licensee’s average daily outstanding obligations (for money received). The bond must be of at least $250,000 without exceeding $7,000,000.

All fees are non-refundable and non-transferable.

• CA Application Fee: $5,000

• Credit Report for Control Persons: $15 (per control person)

Submit your license application (along with the surety bond) online via NMLS . Please note that all documents are required to be filed directly with the DBO, and must be mailed at the same time.

Mailing Address: Department of Business Oversight
Money Transmitter Division

Attn: Applications 45 Fremont Street, Suite 1700
San Francisco, CA 94105-2219

For further information or assistance regarding NMLS, you may contact their call center at (855) 665-7123.