Seven states have agreed to use a standardized process for licensing money services businesses (MSB).
The standardized process would allow one state to review key elements of a license for a money transmitting business – IT, cybersecurity, business plan, background check, and compliance with the federal Bank Secrecy Act – with the other participating states agree to accept the findings.
This is designed to streamline the MSB licensing process.
The states that have agreed to this standardized process are Georgia, Illinois, Kansas, Massachusetts, Tennessee, Texas, and Washington.
Other states are also expected to participate. State regulators, operating through the Conference of State Bank Supervisors (CSBS), signed a policy statement last May where they said they support a 50-state goal.
Other CSBS initiatives include forming a Fintech Industry Advisory Panel of 33 companies to identify challenges and recommend solutions. The state supervisors also plan to build a technology platform to streamline both the licensing and supervision of non-banks, The CSBS will also work with states to harmonize their licensing and supervisory practices.
“This MSB licensing agreement will minimize the burden of regulatory licensing, use state resources more efficiently, and allow for broad participation by other states across the country,” John Ryan, CSBS president and chief executive officer, said.