I'm not a google researcher, but I wrote this for you; enjoy...
Hi,
We are considering starting-up an instant payment and money order
company. The company will be based on-line. The company will be
similar to paypal but with added features like providing a money order
service. I require detailed information on how to set up such company
and an analysis on how the instant payment and money order companies
operate.
The company will be based in the United Kingdom
Thanks
First step to opening any banking related institution is to look at
the environment of the world (external and internal). The Patriot Act
2001 will provide the most barriers for you due to the possibilities
of money laundering that can be done via your website/service. Thus,
you will have to comply with all Patriot Act regulations and
standards:
http://www.epic.org/privacy/terrorism/hr3162.html
I would suggest going to your local FBI headquarters to find out their
specific policy on the patriot act and how to abide by the policies:
http://www.fbi.gov/contact/fo/fo.htm
Once you have met the requirements set by FBI and the Patriot Act,
your next step would be to set-up a corporation, I suggest a type S if
you are planning to keep the company private for a significant period
of time: http://www.legalzoom.com/corporations/index2.html
(you need to register at legalzoom to get started)
Once your company is established, you will need to figure out which
banks/credit unions you will use as your stability base for FDIC
insurance. Any financial/banking type institution – assuming USA
headquarters – will have to have a form of FDIC insurance. In the
case of paypal, for example, they use what is called FDIC pass-through
insurance. FDIC Pass-Through Insurance is basically based on
“Subsection 311(b)(1) of FDICIA [which] requires that the FDIC provide
deposit insurance coverage for deposits accepted by any insured
depository institution on a pro rata or "pass-through" basis ….” (1)
Thus, your first goal is to find a bank to provide you with the proper
accounts to store or, in other words, hold the money you get from
people’s transactions.
Assuming you have found a bank and proper insurance channels, your
next move is to set-up a proper IT network. You would need a flow of
money that streamlines from P2P (person to person) and using you as an
intermediate (i.e. like ebays auctions). Overall, the process of the
company is fairly simple as long as you have adequate security
controls set-up which should be done by an external
auditor/consultant. Once the controls are established, all that needs
to be done is the proper formation of IT (information technology) to
deal with the appropriate money flows. The whole concept if simple,
as stated beforehand; you take in money, you give a receipt, the money
flows out, you keep a cut of the money you were an agent for.
Thanks,
Dr. Adams
(1)
http://www.fdic.gov/search97cgi/s97_cgi.exe?action=View&VdkVgwKey=http%3A%2F%2Fwww%2Efdic%2Egov%2Fregulations%2Flaws%2Frules%2F4000%2D100%2Ehtml&DocOffset=1&DocsFound=10&QueryZip=Pass%2DThrough+Insurance&Collection=redesign2&SearchUrl=http%3A%2F%2Fwww%2Efdic%2Egov%2Fsearch97cgi%2Fs97%5Fcgi%2Eexe%3FQueryZip%3DPass%252DThrough%2BInsurance%26ResultTemplate%3Dfilters%252FCardCat%252Fwwwcardcat%252Ehts
26QueryText%3DPass%252DThrough%2BInsurance%26Collection%3Dredesign2%26ResultStart%3D1%26ResultCount%3D10&ViewTemplate=view%2Ehts#hlhl0 |
