Washington DFI Leads Effort to Streamline Multi-State Licensing

To streamline the licensing process for money services businesses (MSBs) companies wishing to operate in multiple states, DFI Consumer Services proposed to a number of states an agreement describing a two phase licensing process. Under the agreement, the licensing process would be divided into two steps or phases. Provided that participating states agree to certain license standards, states participating in the compact would accept a “phase one review” from any state in the compact. After an applicant received phase one approval from one state, the approval would be accepted by participating states, leaving a “phase two” review to be completed in each individual state. Under this concept, phase one would include a thorough review of licensing items, except for very specific state requirements which would be left for individual states to review under phase two.

The multistate streamlined licensing process is voluntary for both states and applicants.

While Washington took the lead in drafting the Agreement, other participating states quickly embraced the effort and contributed to the project. The Participating states are also working with NMLS to make sure as much functionality as possible is being built into NMLS 2.0, the revisions to NMLS, slated for release next year.

Participating states are conducting a pilot licensing project this month. After making any adjustments based upon the pilot project, the Participating states will offer multistate licensing under the agreement more broadly to new applicants.

The participating states as of this writing are Georgia, Idaho, Iowa, Illinois, Kansas, Kentucky, Massachusetts, North Dakota, Tennessee, Texas, Utah, Vermont, and Washington.