Canada’s economy is one of the most stable, so today, the country meets all legal requirements, innovative systems, tax policy, and investor protection. The banking system plays a vital role in the state’s economy. The country’s leadership is loyal to firms planning to do business in the economic environment. All this contributes to attracting new investors for business development. MSB license in Canada opens up many opportunities for any crypto organization, and today we want to discuss this in more detail.
Money Service Business is a non-bank financial firm that lets people perform the following services:
- currency exchange;
- transfer of assets;
- operations with crypto;
- cashing checks.
A firm operating in the field of providing financial services must be aware of the requirements for it. It includes registration of an organization, reporting, KYC policy, and compliance with AML conditions (fight against illegal money transfers).
A permit will be required for those firms that plan to operate in this country and engage in the financial activities listed below.
These services include carrying out transactions to exchange one type of currency for another, such as exchanging CAD for a USD. It also allows you to trade crypto assets for fiat.
Such a transfer is carried out from one company to another or from a client, using an electronic transfer system or in another way. This type of service also includes the issuance of financial transfers, checks, and other similar services.
This type of service includes the exchange of crypto or its transfer. There are three types of exchange:
- crypto to fiat,
- fiat to crypto,
- the cryptocurrency of one type to a different kind of crypto assets.
And the transfer of crypto as a means of payment includes the following:
- sending crypto at the request of the customers;
- receiving a transfer of digital coins to send to the recipient.
Starting from the summer of 2020, the state leadership has developed laws allowing crypto exchanges to engage in financial activities. Therefore, such firms are considered firms providing financial services.
To get a work permit, you need to follow a few important steps.
There are conditions for the organization’s name, which must consist of at least two words. One word should characterize the main direction of the company—for example, financial payments, exchange, transfers, and others. Abbreviated names of organizations are not allowed.
The organization is required to have a registered address for its office. If it is rented, then present the lease agreement. A photograph of the office premises will also be required.
The regulator does not set the size of the minimum starting capital. But it is recommended to have a significant amount confirming the seriousness of your business. During the organization’s registration period, it is necessary to appoint at least one individual – the head of the company, who has experience in this field.
For your organization to be able to register with FINTRAC, they will need to send the following data:
- submit papers on registration of the firm (with the legal address of the office) and, if there is data on branches;
- details of the owner, senior management, and compliance officer, as well as the total number of employees;
- the entire list of services that the firm will provide;
- bank account details;
- the planned annual amount for conducting transactions in USD for each service separately.
In addition, you must have a compliance policy (KYC, AML, etc.) and a program to reduce your business’s risks. They may also be required to present a business program for a certain period of the organization’s work (1 or 5 years).
Licensing can take several months – just reviewing the FINTRAC package of documents can take about three weeks, and then on the condition that you have submitted all the data and no time is required to provide the missing documents. Sometimes, in addition to the abovementioned requirements, they may request additional data about the organization.
Canada is one of the most economically stable countries in the world, home to a huge number of crypto enthusiasts. If you want to work here legally, you should get a work permit. If you are ready to work legally and openly, you will not have any problems with this.