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Canada MSB License

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Canada Money-Service-Business (MSB) License

Cryptocurrency and Wallet license in EstoniaFor fintech and crypto-focused businesses finding the EU MiCA CASP and PSP regulations too complex, Canada offers a more accessible alternative. The Canadian Money Services Business (MSB) registration, overseen by FINTRAC, allows companies to legally operate crypto exchanges and other crypto asset activities. Further, an MSB registered under Retail Payment Activities Act (RPAA) with the Bank of Canada enables to operate as a Payment Services Provider. There are no minimum capital requirements, and only limited local substance is needed.

An MSB license in Canada covers a broad range of financial services, including but not limited to crypto exchange and non-custodial crypto wallet services, foreign exchange and fund transfers. Canada also provides a strong financial sector, known for its stability and well-regulated environment. While the MSB registration process is relatively straightforward, ongoing compliance with anti-money laundering (AML) and reporting obligations remains essential. Our team of Canada based lawyers and compliance professionals assist throughout the licensing and also with the on-going regulatory compliance.

Quick summary: MSB License in Canada

Crypto Exchange + Wallet
Remittance and Money Transfer
Setup from 2 months
Legal fees from 20.000 EUR
Local substance required
Pricing >>
Contact us >>

Canada MSB and RPAA Registration

Unlike the EU’s CASP framework, Canada does not require a physical office or resident directors for MSB registration. However, companies must appoint a Compliance Officer (CO) to oversee AML programs. We can provide an outsourced solution for a Canadian resident CO appointment. RPAA-registered entities face additional oversight, including financial risk assessments, fund segregation, and annual audits. Our team assists businesses in navigating the Canada MSB and RPAA registration process, ensuring compliance with FINTRAC and the Bank of Canada’s regulatory requirements. Contact us to discuss the best approach for your business needs >>

Canada MSB Registration with FINTRAC

An MSB registered with FINTRAC is primarily regulated for AML and CTF compliance. Registration allows businesses to offer:

  • Crypto exchange services (buy/sell/exchange fiat & crypto)
  • Remittance and money transfer services
  • Foreign exchange (forex trading services)
  • Payment processing, but without holding client funds

The registration process includes submitting details on ownership, operational structure, compliance programs, and financial activity. Once registered, the MSB must implement AML compliance policies, transaction monitoring, and mandatory reporting to FINTRAC.

Canada MSB FINTRAC + RPAA Registration 

An MSB that registers under the RPAA with the Bank of Canada gains additional regulatory oversight. This allows the business to:

  • Hold client funds temporarily for payment processing
  • Process payments between third parties (e.g., merchant payments)
  • Operate similar to a Payment Service Provider (PSP)
  • Be subject to stricter operational risk requirements

The RPAA framework introduces additional compliance measures, including fund safeguarding, operational risk management, and financial reporting requirements. Businesses must maintain a risk framework, separate client funds from business accounts, and submit annual reports and audits. 

General requirements

  • At least 1 shareholder (natural person or corporate entity). No specific restrictions to citizenship or residence.
    For optimal setup structure please consult our legal team. Details of beneficial owners must be provided during registration.
  • At least 1 director appointed. No specific restrictions to citizenship or residence.
  • Appointment of a Compliance Officer (CO) responsible for Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) compliance is required. We can provide an outsourced solution for the CO appointment and full compliance support.
  • A physical office in Canada is recommended, but not mandatory at registration stage. A legal address in Canada is required. We can provide the full local substance solution to meet regulatory expectations.

Taxation

  • Crypto asset exchange services are not subject to VAT.
  • Services invoiced (e.g. sales invoices) in crypto assets are subject to regular VAT rules.
  • The corporate tax rate for a Canada MSB varies based on federal and provincial rates. The federal tax rate is 15% (or 9% for eligible Canadian-Controlled Private Corporations (CCPCs)), while provincial rates range from 2% to 12%, bringing the total tax burden to approximately 23%–31% depending on location and business structure. Please consult with a tax specialist for a tailored solution.

Digital Signatures for Remote Administration

Non-residents of Canada can obtain digital signature capabilities to facilitate company administration. Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA) recognizes electronic signatures as legally binding, allowing both residents and non-residents to utilize them for business transactions. To acquire a digital signature, non-residents can engage with Canadian certification authorities or electronic signature service providers, such as Signority, which offer services compliant with Canadian regulations. These providers typically require identity verification, which can often be completed remotely, enabling non-residents to obtain the necessary digital credentials without being physically present in Canada

Pricing for an MSB License in Canada

Applying for the Canada MSB license with optional RPAA registration (for PSPs) is straightforward as our Canada based lawyers take care of the full legal procedures on your behalf. We can also provide local substance building solutions per regulatory requirements. The company setup and license application submission can be completed remotely without travel. For more information please contact us for a tailor-made offer for your project >>

  • LLC company setup in Canada
  • Remote company setup
  • Estimated setup time
  • Type of setup package
  • FINTRAC Registration
  • Bank of Canada (RPAA) Registration
  • AML/KYC legal package
  • AML compliance consultation
  • Bank Account Opening
  • RPAA Government fee (CAD 2500)
  • BASIC: CANADA MSB (FINTRAC) APPLICATION Canadian LLC setup and MSB registration with FINTRAC. Includes AML policy documentation and full process management.
  • € 20.000
  • 2-3 months
  • New Application
  • SEND ENQUIRY
  • PREMIUM: CANADA MSB (FINTRAC+RPAA) APPLICATION Complete licensing package for company, legal package, submission of the FINTRAC+RPAA applications, and regulatory liaison.
  • € 30.000
  • 3-5 months
  • New Application
  • SEND ENQUIRY
  • PLATINUM: CANADA MSB (FINTRAC+RPAA) ACQUISITION Ready-made active MSB company with full FINTRAC and RPAA registrations. No activity, company name can be changed.
  • € 60.000
  • Transfer 2 weeks (+cool off 2 months)
  • Ready-Made Solution Transfer
  • SEND ENQUIRY

* All orders are subject to our review and subject to our final confirmation; conditions may apply. All pricing is indicative and is subject to our final confirmation upon receiving order details. Prices shown excluding VAT. We reserve the right to change our individual and package prices at any time without notice. Additional fees may apply. Please contact us for a detailed offer specific to your project.

Legal Framework and Requirements in Canada (MSB and RPAA)

The legal framework is governed by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and the Retail Payment Activities Act (RPAA). Under PCMLTFA, crypto exchanges and payment providers must register as Money Services Businesses (MSBs) with FINTRAC, ensuring compliance with anti-money laundering (AML) regulations. RPAA, overseen by the Bank of Canada, applies to payment service providers, requiring operational risk management and consumer fund safeguarding. We assist businesses in obtaining MSB registration and RPAA compliance, preparing the necessary policies and managing the process to ensure full regulatory compliance.

Documentation

For review and preparation of the licensing project we will ask for the following preliminary documentation:

  • Valid copy of passport from each country of citizenship
  • Power of Attorney (PoA)
  • Business plan and forecasts
  • Resume (CV) listing employment and education background for main participants
  • Non-criminal certificate from the registry of convictions (not older than 3 months) for shareholder(s), board member(s), ultimate beneficiary owner(s)  *

All listed documentation has to be certified by notary public and confirmed with an apostille, in English (or sworn English translation). In the first stage we will gather all information and provide step by step process overview according to your case.

Procedures

Our legal compliance team will prepare internal procedures and documentation to ensure your company meets the Anti-Money Laundering (AML), Know Your Customer (KYC), and regulatory requirements under FINTRAC and the Bank of Canada’s RPAA framework. Selected key components include:

Programme of Operations
  • Description of the financial services and activities the company intends to provide, including crypto exchange, money remittance, and payment processing.
  • Operational procedures for client onboarding, transaction processing, and compliance with FINTRAC reporting requirements.
  • Risk management systems to mitigate money laundering, terrorist financing, and financial crime risks, particularly for crypto transactions and cross-border payments.
Internal Security Measures
  • Assessment and management of risks associated with money laundering, terrorist financing, and fraud prevention in financial transactions.
  • Implementation of secure data collection, retention, and storage processes for customer and transaction records, following PCMLTFA and RPAA standards.
  • Reporting procedures for submitting Large Cash Transaction Reports (LCTRs), Suspicious Transaction Reports (STRs), and Virtual Currency Transaction Reports (VCTRs) to FINTRAC.
  • Internal compliance controls to ensure adherence to AML obligations, customer due diligence (CDD), and risk-based assessment protocols.
Rules of Procedure
  • Clear transaction monitoring protocols, defining low-risk vs. high-risk transactions, with special focus on crypto-related risks and money movement trends.
  • Procedures for customer due diligence (CDD), ongoing KYC checks, and enhanced due diligence (EDD) for high-risk customers, as mandated by FINTRAC.
  • Record-keeping requirements for customer information, transaction logs, and compliance reports, ensuring alignment with PCMLTFA and RPAA guidelines.
  • Detailed procedures for applying the FATF Travel Rule in virtual asset transactions to track the origin and destination of funds.

Instructions and Guidelines
Practical steps to identify and manage:

  • Politically Exposed Persons (PEPs) and their transactions.
  • Entities from high-risk jurisdictions or those flagged for AML deficiencies.
  • Persons suspected of involvement in financial crimes (money laundering, fraud, terrorist financing).
  • Individuals or entities subject to economic sanctions or regulatory restrictions.
  • Remote transactions, digital payments, and crypto-related financial activities.

Substance

We provide substance solutions to meet FINTRAC and Bank of Canada (RPAA) compliance requirements, including assistance with setting up a local office and (out)sourcing a part time qualified Compliance Officer (CO). Our services cover ongoing training, operational support, and compliance management to ensure adherence to regulatory obligations.

Compliance Officer (CO) Responsibilities:

  • Implementing and overseeing AML programs as required by PCMLTFA and RPAA.
  • Transaction monitoring, reporting obligations, and risk-based compliance controls.
  • Filing Suspicious Transaction Reports (STRs), Large Cash Transaction Reports (LCTRs), and Virtual Currency Transaction Reports (VCTRs) with FINTRAC.
  • Conducting Customer Due Diligence (CDD), Enhanced Due Diligence (EDD), and Ongoing Due Diligence (ODD) for crypto and financial transactions.
  • Ensuring record-keeping compliance and adherence to FATF Travel Rule requirements.

The specific compliance staffing and operational requirements depend on your business model, risk profile, and transaction volumes. We provide customized recommendations following a preliminary analysis of your regulatory needs.

Revocation

Regulatory authorities can revoke or suspend an MSB’s FINTRAC registration or an RPAA-regulated entity’s status for serious non-compliance. In most cases, businesses receive a warning or remedial action plan, but failure to correct deficiencies can lead to formal deregistration. Below are the most common causes:

  1. Regulatory Non-Compliance – Failure to maintain AML/KYC programs, transaction reporting, or FATF Travel Rule.
  2. False or Misleading Information – Providing incorrect details during registration or in compliance reports.
  3. Operational Inactivity – Failing to commence operations or ceasing business for an extended period.
  4. Governance Failures – Lack of a qualified AML officer (CAMLO) or failure to follow risk management protocols.
  5. Sanctions & Criminal Activity – Involvement in money laundering, fraud, or terrorist financing.
  6. Regulatory Non-Cooperation – Ignoring requests, failing audits, or obstructing inspections.
  7. Financial Instability – Inability to meet obligations or demonstrate solvency.

Penalties for violations can include fines of up to CAD 2 million for businesses and up to CAD 500,000 for individuals, depending on the severity of the breach. Our team ensures full compliance with FINTRAC and RPAA to help businesses avoid penalties and maintain their registration.

Contact us for more information

We can provide a step by step overview with timeframes and budget break-down after gathering the preliminary project information. Our track-record in setting up MSB registrations in Canada is backed by hundreds of projects as we follow a thorough checklist to confirm that all legal requirements are met. Please contact us through the contact form below and we will get back to you with further information.

    Contact details

    Please contact us to be connected with our country manager or to schedule a meeting.

    10 King Street East, Toronto, ON, M5C 1C3