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A Florida surety bond guarantees principal owners and the public that services will be performed with excellence and security. Florida legally requires a variety of contractors and organizations to secure bonds to conduct business across the public service industry. Single Source Insurance is a leading Florida bonding company. Apply easily online and take advantage of lowest rates. Browse the most common types of FL surety bonds, or contact us for a full list.
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What Are Money Transmitter Bonds?
A money transmitter bond is a type of license and permit surety bond. Purchasing one is a requirement for obtaining a license as a money transmitter. Actually, there are two types of licenses for people engaged in money transmission activities:
Both types of licenses require the purchase of a money transmitter bond. The bond serves as the money transmitter�s pledge to operate in full compliance with applicable laws, rules, and industry standards. A violation can subject the bond to claims by any party who suffers a financial loss as a result of the money transmitter�s unlawful or unethical actions.
If you are applying for a Part II license, Part III license, or both, you�ll need to first purchase a money transmitter surety bond once you�ve established your business entity with the Florida Division of Corporations.
Money transmitter licenses are issued by the Florida Office of Financial Regulation (OFR), Financial Institutions Division. License applications are processed through the Office�s online portal. The necessary bond form is available through the portal. Your application won�t be considered complete until all supporting documents, including the money transmitter bond, have been submitted online.
There are three parties to a money transmitter surety bond agreement, including the following:
Any violation by the principal of the money transmitter surety bond agreement entitles an injured party to file a claim seeking compensation for a resulting financial loss. The surety will determine whether or not the claim is valid and perhaps try to negotiate a mutually agreeable settlement.
If no settlement is agreed upon, the surety is likely to pay the claim and then seek reimbursement from the principal. The terms of the surety bond agreement indemnify the surety and make the principal solely responsible under the law for paying all valid claims. By paying a claim in advance, the surety helps maintain public confidence in the money transmitter industry and gives the principal some time to pull together the funds to reimburse the surety.
The annual premium for a money transmitter bond is a small percentage of the required bond amount established by the obligee. It is based on the previous year�s volume of money transmissions and/or payment instruments, so it varies from year to year.
The premium rate is set by the surety on a case by case basis. The primary considerations are the principal�s personal credit score and personal and business finances. The type of foreign currency the principal works with also comes into play, depending on the currency�s stability and strength.
If your credit score is good and your finances are in decent shape, you should be assigned a premium rate in the range of .005% (half of one percent) to 5%.
Request a convenient online quote today, or call to discuss your need for a money transmitter bond with one of our surety bond professionals.
