BVI Money Services Business License_Guideline

BVI Money Services Business License

The Financing and Money Services Act, 2009, provides the legal framework for the provision of the Money Services Business License in British Virgin Islands.

Permitted Activities

Under the Financing and Money Services (Amendment) Act, 2018, the definition of money services business has been expanded (beyond money transmission) to include electronic money, mobile money, payments of money and other alternative methods of money and payment transmission and the operation of automated teller machines.

As per the Financing and Money Services Act, 2009, a person is deemed to carry on money services business if that person carries on the business of:

  1. Providing any of the following services:

    1. Money Transmission Services;
    2. Cheque Cashing Services;
    3. Currency exchange services;
    4. The issuance, sale or redemption of money orders or travelers cheques; or
    5. Other services as may be specified in the regulations; or
  2. Operating as an urgent or franchise holder of a person carrying on a business specified in (a) above.

Categories of License

The following are the categories of the license:

Class A: which allows a licensee to carry on business of transmitting money in any form, including electronic and mobile payments of money;

Class B: which allows a licensee to carry on the business of issuing, selling or redeeming money orders or travelers cheques, cheque cashing and currency exchange;

Class C: which allows a licensee to engage in financing business;

Class D: which allows a licensee to carry on the business of financing lease;

Class E: which allows a licensee to carry on the business of operating an ATM;

Legal Requirements

Sr.

No

 Element Requirement(s)
Entity Requirements The entity making the application is a BVI company under the BVI Business Companies Act 2004.

Company includes:

  1. a company limited by shares;
  2. a company limited by guarantee that is not authorised to issue shares;
  3. a company limited by guarantee that is authorised to issue shares;
  4. an unlimited company that is not authorised to issue shares; or
  5. an unlimited company that is authorised to issue shares.
Director’s Requirements
  • The licensee will need at least 2 (two) natural person Fit and Proper Directors of any jurisdiction.
  • A licensee shall not appoint a director or senior officer without the prior written approval of the Commission.
  • The director must pass the fit and proper criteria
Shareholder requirements
  • The licensee will need at least one shareholder.
  • Corporate shareholding is allowed and 100% foreign ownership is permitted.
Minimum Capital Requirements For the purposes of section 12 of the Financing and Money Services Act, 2009, the minimum capital resource requirement applicable to a BVI money services business is:

  1. cash in hand or cash on deposit in the amount of ten thousand dollars with a licensed bank approved by the Commission; or
  2. cash in hand or cash on deposit in the amount of five thousand dollars with a licensed bank approved by the Commission and security or interest held or issued in the amount of five thousand dollars made up in any of the following ways:
  3. a standby letter of credit or other guarantee that satisfies the criteria specified in section 159; or
  4. an interest in real property located in the Virgin Islands that the Commission approves as a suitable and adequate capital resource.
Compliance with Regulatory and AML/CFT Obligations Before granting a licence, the Commission will need to be satisfied that, on the granting of a licence, the applicant will be able to comply with its regulatory and AML/CFT obligations.

Where the applicant is subject to the supervision of a financial services regulator in another jurisdiction, the Commission will also need to be satisfied that the applicant is in compliance with its regulatory and other relevant obligations in that jurisdiction.

The Commission will usually require the directors to make a declaration to this effect.

Ongoing Obligations

  1. Maintenance of capital resources and deposit : If a licensee’s capital resources fall below the level prescribed in the Regulatory Code 2009 (as amended)4, as well as notifying the Commission, the licensee must prepare and submit a plan showing how it intends to rebuild its capital resource to the requisite level. A licensee generally has up to 30 days to reconstitute its capital and, if it fails to do so, the Commission can take enforcement action, including revocation or cancellation of the relevant licence.
  2. Duty of management to ensure licensee complies with law: Every director, senior officer and person concerned in the management of a licensee must take all reasonable steps to ensure it complies with FMSA and any legislation relating to money laundering, terrorist financing and proliferation financing. Failure to take all reasonable steps is an offence and can lead to a penalty of US$30,000 for an individual.
  3. Segregating customer accounts: Licensees which receive money from a customer for transmission or delivery to a payee customer must establish a separate customer account, which must be segregated from the licensee’s own account.
  4. No solicitation or receipt of money: No one may solicit or receive money from another person for the purpose of carrying on money services business or financing business in or from within the BVI unless licensed or exempt under FMSA. To do so is an offence and can lead to a penalty of US$50,000 for an individual or US$75,000 for corporate and other entities.
  5. Consumer protection measures: The Commission may provide consumer measures for money services and financing businesses, including placing restrictions on interest rates charged, allowing or requiring instalment payments, limiting excessive charges and requiring loan statements and receipts to be provided to customers.
  6. Maintaining Records: A licensed money services business shall keep adequate and orderly records which must include records of:

    1. its financial affairs
    2. all transactions undertaken by the business whether on its own account or for customers;
    3. its policies, systems and controls, including its risk management policies; and
    4. minutes of all board meetings.

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