New Hampshire Money Transmitter Bond: A Comprehensive Guide

July 23, 2021

New Hampshire Money Transmitter Bond

This guide provides information for insurance agents to help their customers obtain New Hampshire Money Transmitter Bonds

At a Glance:

  • Average Cost: Between $1,500 to $7,500 per year based on the applicant’s credit
  • Bond Amount: $100,000
  • Who Needs it: All money transmitters operating in New Hampshire
  • Purpose: To ensure the public will receive compensation for any damages should the money transmitter violate licensing law
  • Who Regulates Money Transmitters in New Hampshire: The New Hampshire Banking Department

Background

New Hampshire statute 399-G:3 requires all money transmitters operating in the state to obtain a license with the Banking Department. The New Hampshire legislature enacted the licensing laws and regulations to ensure that money transmitters engage in ethical business practices. In order to provide financial security for the enforcement of the licensing law, money transmitters must purchase and maintain a $100,000 surety bond to be eligible for licensure.

What is the Purpose of the New Hampshire Money Transmitter Bond?

New Hampshire requires money transmitters to purchase a surety bond as part of the application process to obtain a business license. The bond ensures that the public will receive compensation for financial harm if the money transmitter fails to comply with the regulations set forth in New Hampshire statutes 399-G. Specifically, the bond protects the public in the event the money transmitter engages in any acts of fraud or fails to pay all money owed to consumers. In short, the bond is a type of insurance that protects the public if the money transmitter breaks licensing laws.

New Hampshire Money Transmitter Bond Form

New Hampshire Money Transmitter Bond Form

How Can an Insurance Agent Obtain a New Hampshire Money Transmitter Bond?

BondExchange makes obtaining a New Hampshire Money Transmitter Bond easy. Simply login to your account and use our keyword search to find the “money” bond in our database. Don’t have a login? Enroll now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email or chat from 7:30 AM to 7:00 PM EST to assist you.

At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.

Is a Credit Check Required for the New Hampshire Money Transmitter Bond?

Surety companies will run a credit check on the owners of the money transmission company to determine eligibility and pricing for the New Hampshire Money Transmitter bond. Owners with excellent credit and work experience can expect to receive the best rates. Owners with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the owner’s credit.

How Much Does the New Hampshire Money Transmitter Bond Cost?

The New Hampshire Money Transmitter Bond can cost anywhere between $1,500 to $7,500 per year. Insurance companies determine the rate based on a number of factors including your customer’s credit score and experience. The chart below offers a quick reference for the approximate bond cost on the $100,000 bond requirement.

$100,000 Money Transmitter Bond Cost

Credit Score Bond Cost (1 year)
800+ $1,500
650 – 799 $2,000
600 – 649 $4,000
550 – 599 $7,500

How Does New Hampshire Define “Money Transmitter?”

New Hampshire statute 399-G:1 defines a money transmitter as any business entity who sells/issues payment instruments or stored value or who receives money for the purpose of transmission to another location.

How do Money Transmitters Apply For a License in New Hampshire?

Money transmitters in New Hampshire must navigate several steps to secure their license. Below are the general guidelines, but applicants should refer to the NMLS’s application guidelines for details on the process.

License Period – The New Hampshire Money Transmitter License expires on December 31 of each year and must be renewed before the expiration date

Step 1 – Meet the Net Worth Requirements

Applicants for the New Hampshire Money Transmitter License must have a positive company net worth (assets – liabilities). Applicants must submit a financial statement verifying their net worth when submitting their license application.

Step 2 – Purchase a Surety Bond

Money transmitters must purchase and maintain a $100,000 surety bond

Step 3 – Request a NMLS Account

The New Hampshire Money Transmitter License application is submitted electronically through the Nationwide Multistate Licensing System (NMLS). To submit a license application, applicants must first request to obtain an NMLS account.

Step 4 – Complete the Application

All New Hampshire Money Transmitter License applications can be completed online through the NMLS. Applicants must complete the entire application, and submit the following items:

    • Company financial statements showing a positive net worth
    • List of all company authorized agents
    • List of all company branches/locations
    • The following company contacts:
      • Primary
      • Primary consumer complaint
      • Exam Billing
      • Exam Delivery
      • Litigation
      • Pre-Exam Contact
    • Company’s FinCEN confirmation number and filing date
    • Disclosure questions
    • Company’s AML/BSA policy
    • Company business plan containing the following information:
      • Marketing strategies
      • Products
      • Target markets
      • Fee schedule
      • Operating structure
    • Certificate of Good Standing
    • Company staffing and internal policies
    • Samples of all documents used in the regular course of the lending business
    • Company formation documents
    • Management chart detailing the company’s hierarchy
    • Organization chart detailing the company’s ownership structure
    • Affirmation form
    • Form U-2
    • List of all business activity conducted prior to licensure

Money transmitters must pay the following fees when submitting their license application:

    • $500 license fee
    • $36.25 background check fee (per person)
    • $25 authorized agent fee (per agent)
    • $15 credit report fee (per person)

How Do New Hampshire Money Transmitters Renew Their License?

Money transmitters can renew their license online through the NMLS. License holders need to simply login to their account to access their renewal application. The New Hampshire Money Transmitter License expires on December 31 of each year and must be renewed before the expiration date.

What Are the Insurance Requirements for the New Hampshire Money Transmitter License?

New Hampshire does not require money transmitters to purchase any form of liability insurance as a prerequisite to obtaining a business license. Money transmitters must purchase and maintain a $100,000 surety bond.

How Do New Hampshire Money Transmitters File Their Bond?

New Hampshire money transmitters should submit the completed bond form, including the power of attorney, electronically through the NMLS. The surety bond requires signatures from both the surety company that issues the bond and a representative from the money transmission company. The surety company should include the following information on the bond form:

  • Name and state of incorporation of entity/individual(s) buying the bond
  • Surety company’s name and state of incorporation
  • Date the bond is signed

What Can New Hampshire Money Transmitters Do to Avoid Claims Against Their Bond?

To avoid claims on their bond, money transmitters in New Hampshire must follow all license regulations in the state, including some of the most important issues below that tend to cause claim

  • Do not engage in any acts of fraud
  • Pay all money owed to consumers
  • Properly account for all funds received from consumers

What Other Insurance Products Can Agents Offer Money Transmitters in New Hampshire?

New Hampshire does not require money transmitters to purchase any form of liability insurance as a prerequisite to obtaining a business license. However, most reputable businesses will seek to obtain this insurance anyway. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.

How Can Insurance Agents Prospect for New Hampshire Money Transmitter Customers?

The NMLS conveniently provides a public database to search for active Money Transmitters in New Hampshire. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.

2021-07-23T15:53:23+00:00

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