Home Companies and enterprises Requirements to open a money remittance company

Requirements to open a money remittance company

You know that a money remittance company handles money transfer between two parties who may be residing in two different countries or within the same country.

If your intention is to open a company of this type you must adjust to the requirements of your state, as these vary according to the state where you plan to set up your business.

What are the Requirements to start a money transfer company?

While the requirements to open money remittance companies vary from state to state and the best known are the Western Union and Paypal, there are much more and you can start your own company if you meet minimum requirements that are usually the most common among states such as:

  1. Establish your business in a physical geographic location.
  2. Possess a fixed capital.
  3. Have a guarantee bond.

However, you can start your business in a fixed physical space within your city or establish it online or combine these two options and offer transfers in your physical space and online at the same time.

License for money transfer companies

In addition to meeting the requirements of your state government, you may need to obtain a money transfer license so you will pay the application fees for each state, as each state sets its own fees, but you can check with the National Association of Money Transmitters.

Business Registration

You must obtain and submit the application with the form to FinCEN 2017 by directing it to the Financial Crime Enforcement Network, the agency of the Treasury Department and within 180 days from the date you established the business.

You must also create a merchant bank account at the bank of your choice, as it will allow you to accept debit and credit card payments and allow you to deposit payments and recover your customers’ funds.

Open the business only once all applications have been approved and you have the licenses with you.

Money transfer companies from the United States to Mexico

There are many options that you can count on for sending money from the United States to Mexico and you will find a lot of competition since it is the destination that receives the largest amount of transfers.

For this reason, you should compare the location for the recipient to withdraw the money once re-transferred, the speed of money delivery and the cost, for example, Western Union and Money Gram are two viable options, but how they work:

Step 1: Navigate through the websites of both money remittance companies to find the nearest agent and specify the location in Mexico, then take the money you want to send along with the ID to the people you have chosen.

Although the method of sending money may vary from company to company, it will usually be as simple as completing some documents, delivering cash or credit card money, paying the fee and calling the recipient with instructions on how to receive the money.

To access Money Gram services in Mexico you can access sites such as Superama, Suburbia, Bodega Aurrera, Caja Libertad, Intermex, Calimax, FAMA, Soriana, Coppel and Wal-Mart Mexico.

Step 2: Log in to your online payment processing account. If you use services such as Pyza, Amazon Payments or Paypal, linked to your credit card bank account, you won’t have any problems.

Pay pal has a service that operates a Mexican version, then the recipient will need an account with the payment processor you use, but you can still register for free.

Step 3: Contact your home bank to arrange a bank transfer to the person you want to receive the money, by phone or from home banking if you have registered.

However, if you are out of the country, your bank may have security restrictions that will limit capacity and make the transfer.

What are the best money transfer companies?

In addition to the Western Union, there are many other money remittance company options, such as:

OFX: It is an online provider with low exchange margins and no upfront fees, so cash delivery is a cheap service. It is a digital transfer platform with a low margin of exchange rates from US dollars to Mexican pesos.

You can also set up fee alerts to send money when the rate becomes more favorable for you. Delivery takes 1 to 3 business days but is limited to a minimum of $150 to send and transfers require bank accounts for sending and receiving the money.

Remitly: It is also an online provider with low costs and quick cash delivery.

Money Gram: It is a traditional provider of transfers that offer you the delivery and few hours and cash withdrawal in minutes.

Xoom: Belongs to a large network of online providers that makes money delivery fast in a few minutes.

Although the exchange rate is among the most expensive, delivery speed and other features make up for it, as money can be sent from the Xoom website or mobile application to a recipient’s account at major Mexican banks and the customer service team is available 24 hours a day, 365 days a year and speaks Spanish.

Requirements to open a money transfer company

Western Union: In this case, cash withdrawal transfers arrive in minutes while shipping to bank accounts may take 4 business days, but you can send money online or with the mobile application and pay with a U. S. bank account, debit or credit card or from a Western Union agency in the United States.

By comparing the different money transfer companies, determine which ones offer you the best services according to the money transfer options, the speed of delivery, exchange rate and rates.

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