Notice To Applicants

Note that effective December 1, 2011 this website has been updated.  Numerous forms and instructions have been revised.  Please carefully review instructions and forms to make certain that your application submission complies with the current requirements.  Failure to use correct forms may delay processing and/or result in a return of your application.

Texas Finance Code, Chapter 151 (Chapter 151), generally requires a person or business to have a license to engage in the money services business in Texas.  There are two types of Money Services Business licenses and separate applications for each type.  A person or business that engages in the money transmission business must have a money transmission license.  Money transmission includes 1) issuing or selling prepaid access cards and instruments such as checks, money orders and traveler’s checks; 2) receiving money for transmission; 3) providing third-party bill paying services; 4) transporting currency; or 5) currency exchange.  A person or business that engages only in the currency exchange business must have a currency exchange license.  Please note that there are two separate Money Service Business applications; one application for money transmission and a different application for currency exchange only. 

Certain requirements for a money transmission license are different from the requirements for a currency exchange license.  Please read Chapter 151 to determine if you are engaged in a business that requires a license and what kind of license you need.  Refer particularly to §151.002 (definitions), §151.003 (exclusions), §151.301 (definitions related specifically to money transmission), §151.302 (money transmission license required); §151.501 (definitions related specifically to currency exchange) and §151.502 (currency exchange license required.)  All licenses expire on August 15 of each year.

The filing of an Application for a Money Services Business (Application) for a new license, or requesting an Application or otherwise corresponding with the Texas Department of Banking about the need for a license or about your Application, does not authorize you to engage in business activities that require a license under Chapter 151.  If you are operating without the required license, you are violating Chapter 151 and you are subject to enforcement action and penalties.

To apply for a Money Services Business license, you must file an Application with the Texas Department of Banking.  The Application consists of the forms, schedules, exhibits and attachments that are attached to or follow this Notice.

The filing fee of $2,500 must accompany your application. Your check should be made payable to the Texas Department of Banking.  The filing fee is non-refundable.  In addition, the Department may charge investigations fees for processing applications that take longer than normal or where an onsite investigation is necessary. You will be notified before any investigation fees are imposed.

If you do not submit the filing fee at the same time you submit your application, your application will be returned.  Additionally your application will be returned to you if the application does not include or is not accompanied by:

1. The applicant’s signature, sworn to before a notary.
2. The security, if required, as explained in the SECURITY Section of this Notice and Exhibit G of the application
3. Financial statements, as explained in the NET WORTH Section of this Notice.
4. If applicable, a search firm background investigation report, as explained in BACKGROUND CHECKS Section of this Notice and Appendix A of the application.

The Application must be fully completed and all of the required information must be provided.  You must respond to each question, even if the answer is “None” or Not Applicable”.  Be sure to:

1. Provide complete addresses, including zip codes.
2. Sign each form where required.
3. Have signatures notarized as required.
4. Cross-check the information BEFORE you submit the Application to insure accuracy and consistency in the information provided.

In accordance with the USA PATRIOT Act of 2001 and the Department of Treasury’s Title 31 CFR Chapter X, pertaining to anti-money laundering programs for the Money Services Businesses, each applicant must be aware of the requirements of the law and its implementation deadlines.  Money services businesses currently established must be in compliance with these requirements, including a current registration with Financial Crimes Enforcement Network (FinCEN), a division of the U.S. Department of Treasury, www.fincen.gov as a money services business.

Please direct any questions regarding a Money Services Business Application or a proposed new license to the Texas Department of Banking, Corporate Activities Division, at (512) 475-1342 or corpmail@dob.texas.gov.

SECURITY:  Security is the term used in Chapter 151 to describe the surety bond, irrevocable letter of credit, or deposit required under §151.308 for a money transmission license and §151.506 for a currency exchange license.  The security must accompany the Application when it is submitted to the Department.  The required amounts are:

Currency Exchange License:  $2,500

Money Transmission License:  The greater of $300,000 or an amount equal to one percent of the license holder's total yearly dollar volume of money transmission business in this state or the applicant's projected total volume of business in this state for the first year of licensure, up to a maximum of $2 million. 

Please carefully review Sections §151.304, §151.308, and §151.504 and §151.506 for details about the security requirements.  

NET WORTH:  An Applicant that intends to engage only in the currency exchange business and that applies for a Currency Exchange License must submit a current financial statement that demonstrates the Applicant’s solvency.  The financial statement must be certified to by a responsible officer. 

An Applicant for a Money Transmission License must submit a current audited financial statement that demonstrates that the Applicant possesses and is likely to maintain the net worth, if the license is granted.  Section 151.307 of the Code requires a minimum net worth of $100,000 if business is proposed to be conducted at four or fewer locations and transmission is not conducted via the internet, and $500,000 if business is proposed to be conducted at five or more locations.  If an Applicant provides services or products over the internet, or offers a prepaid access card or similar product, the higher net worth standard of $500,000 will be required. (The commissioner may increase the required net worth up to a maximum of $1 million based on the factors set out in §151.307.)  The required financial statements must be in English and denominated in U.S. Dollars. 

BACKGROUND CHECKS:  Extensive background checks are conducted on each Applicant as well as the control shareholders, principals of the Applicant and responsible individuals. See §151.002 for definitions and Appendix A-Supplemental Forms of the application for clarification. These checks include law enforcement agencies, credit reports, and other regulators.

Any non-U.S. citizen who is required to submit fingerprints and has not resided in the U.S. for at least the last 10 years, must have an investigative background report prepared by an acceptable search firm in lieu of submitting fingerprints.

U.S. citizens living abroad for more than 2 of the last 10 years must also have an investigative background report prepared by an acceptable search firm in addition to submitting fingerprints.

At a minimum, the firm performing the investigate background report must demonstrate that they have sufficient resources and are properly licensed to conduct the search of the background and that the firm is not affiliated with or an interest of any of the individuals under investigation.  The background investigation report must be in English. The cost of the report must be borne by the applicant or the individual.  The investigation report must be submitted directly to the Department with a copy of the report provided at the time of submission of the application.  Refer to Search Firm Report instructions in Appendix A of the application.  Contact the Corporate Activities Division for additional information.

CONFIDENTIALITY:  Review Chapter 151 of the Texas Finance Code thoroughly prior to completing the application form.  If you have any questions please contact the Corporate Activities Division at (512) 475-1342.  Completed application forms should be mailed to:

Texas Department of Banking
Corporate Activities Division
2601 North Lamar Blvd.
Austin, TX  78705-4294

Information submitted in connection with the application may be subject to disclosure under the Open Records Act and Chapter 151 of the Code.  Confidential information should be clearly marked when submitted.

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