What is a Money Services Business? And How is it Regulated?
MSB means money services business. What counts as an MSB in Canada and the US, real examples, how MSBs differ from banks, and the rules MSBs must follow.
Quick answer: MSB stands for money services business. It's a business that handles money for other people but isn't a bank. Examples are currency exchanges, money transfer companies, crypto exchanges and cheque cashers. In Canada, offering even one money service, such as foreign exchange, money transfers or crypto exchange, makes you an MSB. You must register with FINTRAC before you start, renew every 2 years, and run an anti-money laundering (AML) program.
What does MSB mean?
MSB is short for money services business (you'll also see "money service business"). The term comes from anti-money laundering law. Governments use it for businesses that move, exchange or transfer money for the public, because criminals can use those services to launder money.
In banking, "MSB" usually comes up when a bank decides whether to open an account for you. Banks see MSBs as higher-risk customers, so they ask MSBs for proof of registration and a working AML program before banking them. See why banks decline Canadian MSBs.
What counts as an MSB in Canada?
According to FINTRAC, a business is an MSB if it has a place of business in Canada and offers any of these services:
- Foreign exchange dealing: swapping one currency for another
- Remitting or transmitting funds: sending money for clients, including many payment and invoice-payment services
- Issuing or redeeming money orders, traveller's cheques or similar instruments
- Dealing in virtual currency: crypto exchange or crypto transfer services
- Crowdfunding platform services
- Armoured car services: transporting cash, money orders or similar items
- Cheque cashing
- Acquirer services for private ATMs
There's no minimum amount. Offering one of these services as a business is enough.
What is a foreign MSB?
A foreign MSB has no place of business in Canada but offers these services to people or businesses in Canada, for example an overseas crypto exchange or remittance app with Canadian customers. Foreign MSBs must register with FINTRAC too.
Real examples of MSBs
- A currency exchange booth at an airport
- A remittance company sending money abroad for families
- A crypto exchange or crypto ATM operator
- A fintech app that lets users pay invoices or send money to others
- A crowdfunding platform
Not sure which categories apply to you? See our complete guide to FINTRAC MSB categories or check whether you qualify as an MSB in Canada.
What does MSB mean in the US?
In the United States, FinCEN defines an MSB as a business that acts as one or more of:
- a dealer in foreign exchange
- a cheque casher
- an issuer or seller of traveller's cheques or money orders
- a provider or seller of prepaid access
- a money transmitter
Most categories only count above $1,000 per person per day, but money transmitters count at any amount. US MSBs register with FinCEN (Form 107) within 180 days and often need state money transmitter licences too. See our FinCEN MSB registration guide.
MSB vs bank: what's the difference?
An MSB moves or exchanges money, but it doesn't take deposits or lend the way a bank does. Banks are also supervised for safety and capital (by OSFI, for federal banks). For MSBs, the main regulator in Canada is FINTRAC, which focuses on anti-money laundering.
What does an MSB have to do?
Once you're an MSB in Canada, you must:
- Register with FINTRAC before you start, and renew every 2 years. Note that this is a registration, not a licence. See MSB licence in Canada: registration requirements.
- Appoint a compliance officer (CAMLO) and run a written AML program: policies, a risk assessment, training and a review every 2 years. See the 5 pillars of an AML program.
- Know your clients: verify identities and check for sanctions and politically exposed persons.
- Report to FINTRAC: suspicious transactions, large cash transactions and large crypto transactions of $10,000 or more, and keep records for at least 5 years.
Operating without registration is an offence, and penalties have gone up sharply in 2026. See what happens if you operate as an unregistered MSB.
In Quebec, MSBs may also need a provincial licence. See does the province matter for MSB registration?
Common challenges for MSBs
- Banking: banks see MSBs, especially crypto MSBs, as high-risk, so accounts can be hard to open or keep.
- Several countries: MSBs serving more than one country must follow each country's rules.
- Enforcement: weak programs can lead to large penalties, public naming and loss of registration.
Many MSBs use an outsourced compliance officer so they can launch compliant from day one without building an in-house team.
Frequently asked questions
What does MSB stand for?
MSB stands for money services business: a business that exchanges, transfers or handles money for the public but isn't a bank.
What is an MSB in banking?
In banking, MSB refers to a customer that is a money services business. Banks treat MSBs as higher-risk clients and usually ask for proof of FINTRAC (or FinCEN) registration and a working AML program before opening an account.
Is a crypto exchange an MSB?
Yes. In Canada, businesses that deal in virtual currency, meaning crypto exchange or transfer services, are MSBs and must register with FINTRAC.
Do I need a licence to run an MSB in Canada?
At the federal level you need a FINTRAC registration, not a licence. You must register before you start and renew every 2 years. Quebec has its own provincial rules.
What's the difference between an MSB and a money transmitter?
In the US, a money transmitter is one type of MSB. In Canada, "remitting or transmitting funds" is one of the services that makes a business an MSB.
AML Incubator helps money services businesses register with FINTRAC and FinCEN, build their AML programs and provide outsourced compliance officers.
Get help with MSB registration
Sources: FINTRAC, Check to see if you need to register as an MSB · FinCEN, MSB definition
