Operating a cheque cashing business in Canada is a high-stakes venture. You’re now bound to face more struggles because of new FINTRAC rules requiring you to register as a money service business (MSB).Â
These rules may also make you wonder whether you can register MSB yourself or require third-party assistance. Let’s dive into the specifics of DIY MSB registration.
Can I Get a MSB Registered Myself?
You can perform MSB registration for your cheque cashing business without seeking Fintech support. FINTRAC’s official site allows you to start the registration process online and submit documents for approval.
The process may sound easy to you, but it isn’t as straightforward. You have to meet various requirements before you can even start filling out the application form.
If you fail to comply with even one minor requirement, your MSB registration application will be rejected.Â
The Risks of DIY MSB Registration for Cheque Cashing Businesses
While you can do FINTRAC MSB registration yourself, the real question is, should you? Let’s look at the major risks you’ll face if you try to handle MSB registration without expert assistance:
- Compromising Your Existing Business
Getting a FINTRAC MSB license for your cheque cashing business is not something to experiment with. The regulatory organization requires you to structure your application and submit important documents.
FINTRAC is targeting cheque cashers with its new compliance requirements. If you make even a single mistake during this sensitive period, you may expose your business to:
- Sudden FINTRAC AML audits
- MSB compliance investigations
- Cheque cashing business license revocation
An improperly filed registration could flag your business for heightened scrutiny. This is not the kind of attention you want as a cheque-cashing operator.
- Penalties for Cheque Cashing MSB Non-Compliance
Every Canadian MSB is required to implement a strict compliance program to meet FINTRAC’s rules. Your business must:
- Conduct annual risk assessments
- Train employees for cheque cashing business compliance
- Monitor all transactions and report suspicious ones
If you complete the MSB registration process without clearly stating details of your compliance program, you’ll be violating FINTRAC rules.
The worst part is that you’ll risk facing administrative monetary penalties by FINTRAC.Â
- Losing Your Banking Relationship
Maintaining good banking relations is important for cheque cashers in Canada. Without a bank, you cannot cash cheques for your clients.
By getting your cheque cashing MSB registered yourself, you can risk losing your banking relations. That’s because if your application is rejected, most banks will see you as a red flag.
Your ongoing banking partners can terminate their contract if you mishandle FINTRAC MSB registration. Future banking partners will also avoid onboarding your cheque cashing business.
One registration mistake today could haunt your business for years to come.
- Unnecessary Regulatory Delays
The new FINTRAC rules require cheque cashing businesses to complete MSB registration quickly. Waiting for long will put your company at risk of extensive scrutiny and unnecessary audits.
Before submitting your MSB registration application, you must ensure it is complete and accurate. If both requirements are not fulfilled, your business will suffer from regulatory delays.
Keep in mind that a cheque cashing business cannot operate from the period of application submission to MSB registration approval. Every delay you experience will lead to lost revenue.
Why Working With an Expert for Getting a FINTRAC MSB License Matters?
Your cheque cashing business deserves more than "trial and error" compliance. Working with a Fintech firm such as Renno Co. & Fintech allows for submitting an error-free and well-detailed application
We specialize in helping cheque cashers, PSPs, MSBs, and more in Canada. From MSB registration to appointing compliance officers, we cover everything. Here's what working with us looks like:
- Customized MSB Registration: We tailor your FINTRAC registration to your exact operations and risk profile.
- Compliance Program Development: We don't just register you, but also develop a robust AML compliance program.
- Banking Relationship Support: Our experts work tirelessly to get your cheque cashing business banked in Canada.
- Ongoing Support: Enjoy continued advice from our Fintech experts as your business grows, including assistance with mandatory updates.
We know what banks, regulators, and FINTRAC auditors are looking for. You can rely on us to get your cheque cashing business the MSB approval it requires.
The Consequences of Getting Your MSB Registration Wrong
If you mess up your MSB registration, you could face:
- Rejection of FINTRAC MSB license
- Investigation by FINTRAC or the Bank of Canada
- Monetary penalties or imprisonment
- Termination of bank accounts
- Civil lawsuits for cashing cheques for clients improperly
- Credibility damage for trying to operate a business without a FINTRAC MSB license
Registering MSB yourself may save you a few hundred dollars, but it can permanently damage your reputation. You may end up losing thousands of dollars due to business closure, even if it’s temporary.
Protect Your Cheque Cashing Business from the Start by Contacting Renno Co. & Fintech
If you are running or planning to start a cheque-cashing business in Canada, getting your MSB registration right is absolutely critical to your survival.
It is possible to do it yourself, but the risks outweigh the rewards. Mistakes in registration or compliance can end your business before it has a chance to succeed.
Don't leave your future to chance. Contact us today to meet our Fintech experts and let them be your guide for MSB registration. Your business is worth protecting.
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