Case: Obtaining an MSB financial licence in Canada to launch a neobank
What was the client's request?
To open a neobank. Tasks: legal exchange of fiat currencies and cryptocurrencies, providing clients with fund storage services, conducting international payments. Requirements: a license recognised by international banks and payment systems, a transparent jurisdiction with a high level of trust among investors and counterparties.
Why did they not want to or could not implement the task on their own?
The client understood that:
- submitting an application to FINTRAC (the regulator in Canada) requires precise knowledge of legal norms;
- errors in the preparation of the business model and AML policies could lead to the refusal to issue a license;
- ignorance of Canadian law could result in fines and the blocking of activities;
- financial losses could arise due to errors in the submission of documents and re-registrations;
- there would be a loss of time due to delays in the launch date caused by refusals and re-checks.
What solution did we offer and why?
We offered a ready-made company in Canada with a submitted PSP application. This is a completed application to the Bank of Canada for a payment services licence in accordance with the RPAA:
- the license allows the legal provision of fiat and cryptocurrency exchange services, money transfers and fund storage;
- it is a quick solution, as the company is already registered and the license application has been submitted;
- all documents have been prepared in accordance with FINTRAC requirements;
- internal policies for secure fiat and cryptocurrency operations are in place;
- quick access to a bank account.
Were there any difficulties in resolving the request? If so, what were they?
Finding a bank willing to work with an MSB company, but we found a solution.
How long did the case take?
The process of re-registering the company and opening an account took about 1 month.
What specialists were involved?
- a lawyer specialising in financial regulation in Canada;
- a tax consultant;
- an MSB licensing specialist;
- an Intelligent Solution Group expert on AML/KYC and banking support.
Result
- A ready-made company with an already obtained license was registered.
- Internal AML/KYC policies were prepared and approved.
- Due diligence of managers and shareholders was completed.
- An account was opened for the company's needs, an operating account for accounting payments, tax payments and employee salaries. A second account was opened for client funds, a correspondent account.
- A neobank was launched with currency exchange (fiat ↔ crypto) and fund storage functions.
