Illinois Transmitter of Money Licensee Surety Bond
Any entity looking to transact the business of selling or issuing payment instruments, transmitting money, or exchanging, for compensation, payment instruments or money of the United States government or a foreign government to or from money of another government in the State of Illinois, must post and maintain a Surety Bond in a minimum amount of $50,000, in accordance with the provisions of the IL Transmitters of Money Act. The surety bond provides financial assurance to the state that the licensee will faithfully conform to and abide by each and every provision of the IL Transmitters of Money Act and of all rules, regulations and directions lawfully made by the Director of Financial Institutions thereunder, and will pay to the State and to any person or persons any and all moneys that may be come due and owing to the State and to such person or persons from said obligors, under and by virtue of the provisions of said Act. Surety bonds and the underlying license renew annually on December 31st.
Who is required to post an IL Money Transmitter License Bond?
A transmitter of money license is required in the state of Illinois for all entities who:
Sells or issues payment instruments.
Engages in the business of receiving money for transmission or transmitting money.
Engages in the business of exchanging, for compensation, money of the United States Government or a foreign government to or from money of another government
In accordance with the Financial Regulation (205 ILCS 657/30) - Transmitters of Money Act.
The applicant or licensee shall post a bond in the amount of $50,000 or an amount equal to 1% of all Illinois-based activity, whichever is greater, up to a maximum amount of $2,000,000. When the amount of the required bond exceeds $1,000,000, the applicant or licensee may, in the alternative, post a bond in the amount of $1,000,000 plus a dollar for dollar increase in the net worth of the applicant or licensee over and above the amount required in Section 20, up to a total amount of $2,000,000.
(f) After receiving a license, the licensee must maintain the required bond plus net worth (if applicable) until 5 years after it ceases to do business in this State unless all outstanding payment instruments are eliminated or the provisions under the Revised Uniform Unclaimed Property Act have become operative and are adhered to by the licensee.
You should also review Title 38, Part 205 of the Financial Institutions Administrative Code for additional information on licensing as a Money Transmitter in the state of IL.
Businesses are regulated by the Illinois Department of Financial & Professional Regulation and all licensing is handled and processed through NMLS, for additional information on the licensing process, please visit NMLS New Application Check List for IL Money Transmitter
How much does an IL Money Transmitter License Bond cost?
Surety bonds are based upon personal credit of the owners of the business along with the financial strength of the business (for larger bonds). Submissions with good personal credit can expect a rate of 2% ($1000 per year for a $50,000) bond. Surety Bond Premium is due annually at the renewal date for the ensuing bond term. For submissions with less than stellar credit, we do have a bad credit surety bond program where the rate will fluctuate in accordance with the degree of derogatory items showing on the credit report.