What is the Cost of MSB License in Canada

• The MSB license cost in Canada should be taken into account by entrepreneurs and financial service providers who are going to conduct business in such fields as money transfer, foreign exchange, remittance, payment processing, or virtual currency business in Canada.  

• The total MSB license cost in Canada depends on such factors as company incorporation, compliance preparation, AML policy preparation, operation set-up, and other costs arising due to the Canadian regulation under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.  

• For those who seek to obtain the Canada MSB license, registration in FINTRAC will be necessary since it regulates Money Services Businesses. In case you need information about MSB license cost in Canada, Tetra Consultants will provide you with the full picture of the issue and help you with MSB registration in Canada. 

Breakdown of MSB license cost in Canada

FINTRAC MSB registration fee 

• One of the most significant benefits of setting up an MSB in Canada is the absence of any FINTRAC government registration fee for MSB registration. According to FINTRAC MSB registration instructions, businesses do not have to pay any government regulatory filing fee when applying for their MSB registration.  

• This is true for domestic MSBs as well as Foreign Money Services Businesses (FMSBs). Despite the lack of registration fees, businesses must comply with all anti-money laundering reporting and other regulatory obligations required under the relevant Canadian legislation. 

FINTRAC MSB renewal fee 

• In order to keep their regulatory status, MSBs registered in Canada have to renew their registration with FINTRAC on a regular basis. According to official FINTRAC instructions, there is no renewal fee required to be paid by businesses in connection with MSB renewal.  

• Canada is therefore relatively attractive for fintech startups, money transfer organizations, cryptocurrency businesses, foreign currency exchange companies, etc.  

• Nevertheless, businesses need to ensure that all their compliance, reporting, and record-keeping requirements are met during the renewal process. 

Federal incorporation filing fee 

• Before registering an MSB business, the majority of companies usually form a Canadian company through federal incorporation. According to the official government source from Corporations Canada, the federal incorporation filing fee, when incorporating online, is equal to CA$200.  

• This fee is charged in case of incorporation under the Canada Business Corporations Act. Federal incorporation is often the option chosen by MSB business owners who plan to establish operations in several Canadian provinces since federal incorporation ensures protection of the name in all Canadian provinces.  

• The incorporation fee is not associated with FINTRAC registration and represents one of the expenses involved in MSB setup. 

Name search NUANS fee 

• Many business incorporations include checking the proposed corporate name via the NUANS service. While the actual price may differ according to a particular agency that provides the name search and the filing method, NUANS search is considered official in Canadian incorporation.  

• The process of naming and searching is necessary for MSB applicants since registration with FINTRAC normally implies an already incorporated company. In fact, the use of this service prevents complications in the process of MSB registration. 

MSB Provincial incorporation fees 

• The choice between federal and provincial incorporation by some MSB operators depends on the targeted clientele and business strategy. Government fees for provincial incorporation vary from one province/territory to another in Canada due to each having its own independent corporate registry and fee schedule.  

• For instance, Ontario, British Columbia, Alberta, and Quebec have different costs associated with filing documents for incorporation of an enterprise.  

• These government filing fees are announced by the respective provincial governments, which should generally be remitted as part of the provincial incorporation process prior to the application to FINTRAC for MSB registration. 

Extra-provincial registration fee 

• In cases where a federally incorporated MSB is to carry on operations in other provinces in addition to its principal operating jurisdiction, extra-provincial registration could be necessary. Provinces have individual registration processes in Canada for businesses incorporated in other places within or outside the country.  

• The amount of fee that needs to be filed with the provincial government varies with respect to the province of registration. This additional cost is mostly applicable to MSBs intending to conduct physical operations in several Canadian provinces with federal incorporation. 

Annual corporate filing fee 

• In Canada, after being incorporated, the corporations need to submit their annual corporate filings or annual reports as well. An official government filing fee would depend on whether the corporation was incorporated either provincially or federally.  

• It serves as one of the means of keeping the corporation in good standing and ensuring that its corporate documentation is up to date. Active corporation status is especially important for MSBs because registration with FINTRAC is impossible without it. 

Corporate name reservation fee 

• In some provinces, an additional fee will be charged for the process of name reservation before incorporating the company. In such case, the fee amount will depend on both the province and the corporate registry regulations there.  

• Name reservation would be necessary where the corporate registrar reviews the proposed name before approving it for use. The name reservation step will facilitate the incorporation and banking process for MSBs, as well as avoid application rejections. 

Registration fee under the Bank of Canada RPAA regulations 

• Some MSBs that engage in electronic money transactions are also covered under the supervision of the Retail Payments Activities Act (RPAA), which comes under the purview of the Bank of Canada.  

• As per the requirements laid down in the registration process for service providers of payment solutions through the Bank of Canada, there may be an official registration fee applicable to the qualifying business performing regulated payment operations.  

• It needs to be noted that this requirement is in addition to the requirements of FINTRAC MSB registration and is mainly related to businesses engaged in electronic payments. 

Document filing charges for certified corporate records 

• When businesses get themselves incorporated or comply with the requirements of regulatory authorities, they may require certain government-certified documents issued by the Canadian government. Such documents include certificates of incorporation, certificates of status, certified articles, and other official extracts from the corporate registry.  

• The government normally levies charges for providing such documents to businesses. The issuance of government-certified documents by the authorities may be required by various financial institutions and for other compliance purposes. 

Conclusion 

• It is very important to have knowledge about the MSB licensing fee in Canada for business owners who wish to venture into the regulated financial services sector. Although governmental costs in Canada are fairly simple and transparent, it is vital for entrepreneurs to have adequate preparation and structure in place to avoid any kind of problems in the future.  

• At Tetra Consultants, our clients get a transparent price quote with no hidden charges, which helps them grow their businesses effectively and strategically. At Tetra Consultants, we offer a wide range of assistance services to entrepreneurs, which include but not limited to setting up a Canadian company, FINTRAC MSB licensing, drafting AML/Compliance documents, corporate bank account opening, accounting and tax services, nominee directors and shareholders services, and corporate maintenance. 

• Contact us and we will respond within 24 hours.