HB 881 — An Act amending the act of September 2, 1965 (P.L.490, No.249), referred to as the Money Transmission Business Licensing Law, further providing for title of act and for definitions; providing for short title; and further providing for license required, for exemptions, for qualifications for a license, for fee, financial statement and security, for liability of licensees, for licensee requirements and for agents.

PRINTER'S NO.   913

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 881
                                               Session of
                                                 2025

     INTRODUCED BY CONKLIN, BURGOS, NEILSON, GIRAL, HILL-EVANS,
        KENYATTA AND PIELLI, MARCH 11, 2025

     REFERRED TO COMMITTEE ON COMMERCE, MARCH 11, 2025


                                    AN ACT
 1   Amending the act of September 2, 1965 (P.L.490, No.249),
 2      entitled "An act providing for the licensing and regulation
 3      of the business of transmitting money or credit for a fee or
 4      other consideration by the issuance of money orders, by the
 5      sale of checks or by other methods; conferring powers and
 6      duties upon the Department of Banking and Securities; and
 7      imposing penalties," further providing for title of act and
 8      for definitions; providing for short title; and further
 9      providing for license required, for exemptions, for
10      qualifications for a license, for fee, financial statement
11      and security, for liability of licensees, for licensee
12      requirements and for agents.
13      The General Assembly of the Commonwealth of Pennsylvania
14   hereby enacts as follows:
15      Section 1.    The title of the act of September 2, 1965
16   (P.L.490, No.249), referred to as the Money Transmission
17   Business Licensing Law, is amended to read:
18                                  AN ACT
19   Providing for the licensing and regulation of the business of
20      transmitting money, virtual currency or credit for a fee or
21      other consideration by the issuance of money orders, by the
22      sale of checks or by other methods; conferring powers and
23      duties upon the Department of Banking and Securities; and
 1      imposing penalties.
 2      Section 2.     The definitions of "agent" and "transmittal
 3   instrument" in section 1 of the act are amended and the section
 4   is amended by adding a definition to read:
 5      Section 1.     Definitions.--Unless the context clearly
 6   indicates otherwise, the following words when used in this act
 7   shall have the following meanings:
 8      "Agent" means any person that provides money transmission or
 9   virtual currency transmission services on behalf of another
10   person.
11      * * *
12      "Transmittal instrument" means any check, draft, money order,
13   personal money order, debit card, stored value card, electronic
14   transfer or other method for the payment of money or virtual
15   currency or transmittal of credit or virtual currency, other
16   than a merchandise gift certificate or instrument with a similar
17   purpose sold in the regular course of business by a vendor of
18   personal property or services in a closed loop system or hybrid
19   closed loop system.
20      "Virtual currency" means as follows:
21      (1)    The term includes a digital representation of value
22   that:
23      (i)    Is used as a medium of exchange, unit of account or
24   store of value.
25      (ii)    Is not money, unless the virtual currency was adopted
26   or authorized by a domestic or international government as a
27   medium of exchange, whether denominated in cash.
28      (2)    The term does not include:
29      (i)    A transaction in which a merchant grants, as part of an
30   affinity or rewards program, value that cannot be taken from or

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 1   exchanged with the merchant for money, bank credit or virtual
 2   currency.
 3      (ii)     A digital representation of value issued by or on
 4   behalf of a publisher and used solely within an online game,
 5   game platform or family of games sold by the same publisher or
 6   offered on the same game platform.
 7      Section 3.    The act is amended by adding a section to read:
 8      Section 1.1.     Short Title.--This act shall be known and may
 9   be cited as the Money Transmission and Virtual Currency
10   Transmission Business Licensing Law.
11      Section 4.    Sections 2, 3(1), 4(a)(1) and (c)(5) introductory
12   paragraph, 6 heading and (a)(2) and (3) and (b.1), 11(a),
13   11.1(1), (2), (3) and (4) and 12(b) and (c)(2), (3) and (6) of
14   the act are amended to read:
15      Section 2.    License Required.--(a)   No person shall [engage]:
16      (1)    Engage in the business of transmitting money by means of
17   a transmittal instrument for a fee or other consideration with
18   or on behalf of an individual without first having obtained a
19   license from the department.
20      (2)    Engage in the business of transmitting virtual currency
21   by means of a transmittal instrument for a fee or other
22   consideration with or on behalf of an individual without first
23   having obtained a license from the department.
24      (b)    This act does not apply to money transmission or virtual
25   currency transmission between business entities in connection
26   with commercial contracts, unless the contracts involve money
27   transmission or virtual currency transmission for personal or
28   household purposes involving individuals.
29      Section 3.    Exemptions.--No license shall be required for any
30   of the following:

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 1      (1)   Banks, bank and trust companies, credit unions, savings
 2   banks and [private banks] trust companies organized under the
 3   laws of this Commonwealth; similar banking institutions
 4   organized under the laws of the United States or of any other
 5   state [which are insured by the Federal Deposit Insurance
 6   Corporation]; similar credit unions organized under the laws of
 7   the United States or another state[, and insured by the National
 8   Credit Union Share Insurance Fund]; and savings and loan
 9   associations and building and loan associations organized under
10   the laws of another state or of the United States; or their
11   affiliates or agents.
12      * * *
13      Section 4.   Qualifications for a License.--(a)   To qualify
14   for a license an applicant shall:
15      (1)   have a tangible net worth of at least five hundred
16   thousand dollars ($500,000) as determined by audited financials
17   prepared in accordance with United States generally accepted
18   accounting principles; and
19      * * *
20      (c)   The department may deny a license or otherwise restrict
21   a license if it finds that the applicant, or a director,
22   officer, partner, employee, agent or ultimate equitable owner of
23   ten percent or more of the applicant:
24      * * *
25      (5)   does not possess the financial responsibility,
26   character, reputation, integrity and general fitness to command
27   confidence of the public to warrant the belief that the money
28   transmission or virtual currency transmission business will be
29   operated lawfully, honestly, fairly and within the legislative
30   intent of this act and in accordance with the general laws of

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 1   this Commonwealth. For purposes of this clause, an applicant is
 2   not financially responsible if the applicant has shown a
 3   disregard in the management of the applicant's own financial
 4   condition. The factors that the department may consider in
 5   making a determination regarding an applicant's financial
 6   responsibility shall include:
 7      * * *
 8      Section 6.   Fee, Financial Statement and Security Bond.--(a)
 9   Each application for a license shall be accompanied by:
10      * * *
11      (2)   a financial statement showing a tangible net worth of at
12   least five hundred thousand dollars ($500,000) as determined by
13   audited financials prepared in accordance with United States
14   generally accepted accounting principles;
15      (3)   a bond in the penal sum of one million dollars
16   ($1,000,000) executed by a surety company authorized to transact
17   business within the Commonwealth of Pennsylvania [or securities
18   as provided in the following subsection]. The bond shall run to
19   the Commonwealth of Pennsylvania and shall be for the use of the
20   Commonwealth and of any person or persons who may have a cause
21   of action against the licensee for failure to carry out the
22   terms of any transmittal instrument which the licensee shall
23   have issued and who were residents of the Commonwealth of
24   Pennsylvania at the time the cause of action arose. The
25   condition of the bond shall be that the licensee will comply
26   with and abide by the provisions of this act and the rules and
27   regulations of the department lawfully promulgated under this
28   act and that the licensee will pay to the Commonwealth, to the
29   department or to any other person any moneys that may become due
30   from the licensee to the Commonwealth or to the department or to

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 1   any other person under the provisions of this act or of any
 2   transmittal instrument issued by the licensee within this
 3   Commonwealth and who were residents of the Commonwealth of
 4   Pennsylvania at the time the cause of action arose. If any
 5   person shall be aggrieved by the misconduct of any licensee, he
 6   may upon recovering judgment against such licensee, issue
 7   execution under such judgment and maintain an action upon the
 8   bond of the licensee in any court having jurisdiction of the
 9   amount claimed, provided the department assents thereto.
10      (b.1)   If the department, in its discretion, shall determine
11   the bond [or deposit of securities] provided for in clause (3)
12   of subsection (a) is not adequate, the department may, after an
13   examination and a consent agreement or order, require an
14   additional bond in an amount up to the average daily outstanding
15   balance of money received for transmission in this Commonwealth
16   during the thirty days preceding the department's requirement
17   plus an additional ten percent of the amount of the average
18   daily outstanding balance subject to the same conditions and the
19   same right of execution provided for in clause (3) of subsection
20   (a).
21      * * *
22      Section 11.   Liability of Licensees.--(a)   Every licensee
23   shall be liable for the payment of all moneys or virtual
24   currency covered by transmittal instruments which he issues in
25   this Commonwealth whether directly or through an agent and
26   whether as a maker or a drawer.
27      * * *
28      Section 11.1.   Licensee Requirements.--A licensee shall:
29      (1)   Operate in a safe and sound manner, ensuring that its
30   practices and the practices of its agents, if applicable, do not

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 1   create the likelihood of material loss, insolvency or
 2   dissipation of assets, or otherwise materially prejudice the
 3   interest of individuals who use the licensee's services to
 4   transmit money or virtual currency.
 5      (2)   Comply with all applicable Federal or State laws and
 6   rules pertaining to the business of money transmission[.] or
 7   virtual currency transmission, including 12 U.S.C. Ch. 21
 8   (relating to financial recordkeeping) and 31 U.S.C. Ch. 53
 9   (relating to monetary transactions).
10      (3)   Register all of its agents who engage in the business of
11   money transmission or virtual currency transmission involving
12   individuals who are located in this Commonwealth.
13      (4)   On a date determined by the department, file a report
14   setting forth such information as the department shall require
15   concerning the money transmission or virtual currency
16   transmission business conducted by the licensee. Licensees who
17   fail to file the required report by the date required by the
18   department may be subject to a penalty of one hundred dollars
19   ($100) for each day after the due date until the report is
20   filed.
21      * * *
22      Section 12.   Agents.--* * *
23      (b)   An agent engaged in the business of money transmission
24   or virtual currency transmission under subsection (a) or subject
25   to an exemption under section 3 shall be appointed pursuant to a
26   written agreement between the agent and the person on whose
27   behalf the agent is acting.
28      (c)   The written agreement shall contain at least the
29   following provisions:
30      * * *

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 1      (2)    The agent is acting on behalf of the person employing
 2   the agent's service for the transmission of money or virtual
 3   currency.
 4      (3)    The agent is subject to the control of the person on
 5   whose behalf the agent is acting, meaning that the licensee or
 6   exempted person takes complete financial responsibility for the
 7   money or virtual currency being transmitted from the moment an
 8   individual initiates the transmission of money or virtual
 9   currency until the intended recipient receives the transmitted
10   money or virtual currency.
11      * * *
12      (6)    The agent may not provide money transmission or virtual
13   currency transmission outside the scope of activity permissible
14   under the written agreement between the agent and the person on
15   whose behalf the agent is acting except to the extent that the
16   agent is licensed itself or operating as an agent for another
17   person.
18      * * *
19      Section 5.    This act shall take effect in 60 days.




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