Getting a payment gateway as a remittance or money transfer company is one of the most consistent operational challenges in the industry. This guide explains exactly what's happening — and what to do about it.
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A payment gateway for a remittance company is a payment processing solution specifically designed — or explicitly approved — to handle transactions from a money services business (MSB). It enables the company to collect payments from senders, typically by debit card, credit card, or bank transfer, and route those funds into the disbursement network that delivers money to recipients in another country.
This sounds straightforward, but the standard payment gateway market is not built for remittance operators. Most consumer-facing gateways — Stripe, PayPal, Square, and similar platforms — explicitly exclude money transmission businesses from their terms of service. This is not a commercial preference. It is a compliance-driven policy. These platforms are underwritten for low-risk merchant categories, and their acquiring bank partners are not structured to absorb the regulatory obligations that come with a money services business.
What a remittance company actually needs is a high-risk merchant account with a specialist acquirer, or a banking-as-a-service (BaaS) provider that has built its infrastructure explicitly for licensed financial services businesses. The distinction matters enormously, and understanding it early saves significant time and protects your processing history.
Both Stripe and PayPal list money transmission and remittance services as restricted or prohibited categories in their Acceptable Use Policies. Applying to these platforms as a remittance operator does not just result in rejection — it can result in account termination after approval, which is significantly more damaging. A terminated account can contribute to placement on the Terminated Merchant File (TMF), also known as the MATCH list, a shared industry database that makes future payment processor applications considerably more difficult for up to five years.
The "high risk" classification applied to remittance companies reflects a specific set of operational, regulatory, and financial characteristics that make money transfer businesses more complex to underwrite than standard merchant categories. Understanding these factors from a processor's perspective is the first step toward addressing them effectively in your application.
Figure 1: The five primary factors that lead payment processors to classify remittance companies as high risk
Every remittance transaction crosses at least two regulatory jurisdictions — the country where the sender originates the payment and the country where the recipient receives the funds. For operators serving multiple corridors, this multiplies rapidly. Each jurisdiction applies its own licensing requirements, transaction reporting obligations, sanctions screening mandates, and consumer protection rules. Payment processors that accept a remittance merchant inherit a portion of this compliance obligation, and most standard acquirers are not equipped — or willing — to absorb it.
The Financial Action Task Force (FATF) specifically identifies money transfer businesses as one of the most scrutinised sectors in its guidance. In the United States, the Bank Secrecy Act (BSA) requires remittance operators to maintain documented AML programs, file Suspicious Activity Reports (SARs), and screen transactions against the OFAC Specially Designated Nationals (SDN) list. Payment processors that onboard non-compliant remittance operators face their own regulatory liability — which drives the intensive scrutiny applied during underwriting.
Cross-border money transfers are extremely difficult to reverse once initiated. If a customer disputes a transaction after funds have been disbursed internationally, the processor faces a chargeback it cannot recover from the receiving end. Visa's updated Visa Acquirer Monitoring Program (VAMP), introduced in 2026, has further tightened the scrutiny acquirers apply to high-volume, high-frequency merchant portfolios — making chargeback management a critical ongoing concern for remittance operators.
Where your customers are sending money is assessed as part of the risk profile of your business. Transfers to certain regions — including parts of West Africa, Southeast Asia, the Middle East, and Latin America — are flagged at elevated risk levels by processors and their acquiring banks due to concerns around sanctions exposure and correspondent banking restrictions. If your business model includes these corridors, even as a minority of volume, expect this to be an explicit underwriting consideration.
Payment processors take on regulatory exposure when they board a remittance company. If your money transmission licenses are incomplete, expired, cover the wrong jurisdictions, or are simply pending, the processor's own compliance standing is at risk. This is why licensing documentation is the first verification any underwriting team will conduct — and the single most common reason for immediate application rejection.
The global remittance market processed an estimated $905 billion in 2024, according to the World Bank's Migration and Development Brief. Despite this scale, accessing basic payment infrastructure to participate in this market remains one of the sector's most frustrating operational bottlenecks for startups and scale-ups alike.
Figure 2: Key market and processing benchmarks for remittance companies in 2026
High-risk specialist processors do approve remittance companies — but they apply a rigorous underwriting process before doing so. The criteria they evaluate are consistent across most processors in this space. Understanding what they are looking for before you apply is the single most effective way to improve your approval probability and reduce the time to decision.
| What Processors Check | Why It Matters |
|---|---|
| Money Transmitter License | Active MTL / MSB / FCA / PI license for every operating jurisdiction — no exceptions |
| AML/KYC Program | Documented, active compliance program — not just a policy on paper |
| Compliance Officer | Named individual with verifiable AML credentials, not a generic "compliance team" |
| Corridor Documentation | Full list of send/receive countries with projected volumes by corridor |
| Financial History | 6–12 months of bank statements; prior processing history and chargeback ratio if available |
| Chargeback Ratio | Below Visa/Mastercard threshold — typically under 1% by transaction volume |
| Compliant Website | Fee transparency, T&Cs, privacy policy, regulatory disclosures, support contact — all live |
| Business Model Clarity | Clear explanation of customer base, funding methods, and payout network |
Figure 3: The eight criteria specialist processors evaluate when underwriting a remittance merchant account
This is the foundational requirement. No legitimate high-risk processor will onboard a remittance company without verifying that the business holds appropriate money transmission licenses for every jurisdiction where it operates. Applications submitted without complete and active licensing will be declined immediately. Some processors will accept conditional applications with licensing in progress, but initial processing limits will be lower and reserve requirements higher until full licenses are confirmed.
Processors do not just want to see an AML policy document — they want evidence that you have a functioning compliance system in operation. A credible AML/KYC program for a remittance business includes Customer Due Diligence (CDD) and Enhanced Due Diligence (EDD) procedures, real-time transaction monitoring calibrated to your corridor risk profile, sanctions screening against OFAC, UN, and EU Consolidated lists, a documented SAR filing procedure aligned with FinCEN requirements, PEP handling procedures, and staff training records demonstrating active implementation.
Every underwriting application for a remittance merchant account will ask for the name, qualifications, and contact details of your Compliance Officer. This must be a real individual with verifiable experience in financial crime prevention or AML compliance. A generic reference to a "compliance team" without a named individual will raise immediate concerns during underwriting review.
Processors need to model the risk profile of your business before they can price it and approve it. This requires detailed documentation of which countries you send money from and to, your average transaction value, projected monthly processing volume, the profile of your customer base, how funds are collected from senders, and how they are disbursed to recipients. A blanket claim of "global operations" without specifics is one of the leading causes of underwriting delays and rejections.
Payment gateway approval and money transmission licensing are two separate requirements — but one depends entirely on the other. You cannot get a payment gateway approved without the licensing in place. Below is a structured overview of the licensing requirements across major operating jurisdictions.
FinCEN MSB Registration (federal) + state-level Money Transmitter Licenses (MTLs) in each operating state + BSA/AML compliance + OFAC sanctions screening required
FCA authorization as a Payment Institution or registration as a Small Payment Institution under the Payment Services Regulations 2017
Payment Institution (PI) or Electronic Money Institution (EMI) license under PSD2 + 6th Anti-Money Laundering Directive (6AMLD) compliance obligations
FINTRAC Money Services Business (MSB) registration + PCMLTFA AML/CTF program obligations — applies to both domestic and foreign MSBs serving Canadian customers
AUSTRAC Remittance Dealer Registration + compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act (AML/CTF Act 2006)
MAS Payment Service Provider License under the Payment Services Act 2019 — Standard or Major Payment Institution depending on annual transaction thresholds
Figure 4: Money transmission licensing requirements by major jurisdiction — the prerequisite for any payment gateway approval
The process of obtaining a payment gateway as a remittance company follows a clear sequence. Each step builds on the previous one, and skipping steps — particularly the licensing and compliance infrastructure stages — does not accelerate approval. It ensures rejection.
Figure 5: The seven-step process for securing payment gateway approval as a remittance or money transfer company
Identify every jurisdiction where you plan to operate and obtain the corresponding money transmission license before approaching any payment processor. In the United States, file FinCEN MSB registration first — it is federal and relatively quick to process — then prioritise state-level MTL applications in your core markets. Budget between three and twelve months for state licensing depending on the jurisdiction.
Develop a formal AML/KYC compliance program tailored to your specific business model and corridors. Appoint a qualified Compliance Officer. Implement transaction monitoring technology — dedicated MSB compliance platforms include ComplyAdvantage, Acuant, and Ondato. Document everything systematically: policies, operating procedures, training records, and sanctions screening results. This documentation becomes the compliance package underwriters review during your gateway application.
Incomplete applications are the most common source of delay in the underwriting process. A complete package includes your Certificate of Incorporation, all active money transmission licenses with expiry dates, FinCEN MSB registration confirmation, your full signed AML/KYC policy document, the Compliance Officer's name and credentials, six to twelve months of business bank statements, prior processing history and chargeback data if applicable, a detailed business plan with projected monthly volumes and average transaction values, your complete corridor list, and your website URL with terms of service, privacy policy, and fee disclosure pages live and accessible.
Target specialist high-risk acquirers and BaaS platforms with documented experience underwriting money services businesses. Apply to at least two or three processors simultaneously — approval is not guaranteed even with strong documentation, and maintaining parallel applications protects your timeline. Avoid any processor that does not explicitly list MSB or money transfer businesses among their supported merchant categories.
Initial approval will come with a rolling reserve — typically 5% to 10% of processed volume held for 90 to 180 days — and a monthly processing cap. Both are standard and expected, not negotiable at the point of first approval. They typically become negotiable after 90 to 180 days of clean processing history. Build the reserve holding requirement into your working capital model from day one: at 10% reserve on $100,000 monthly processing volume, $10,000 of monthly revenue is inaccessible for the first six months.
Acquiring banks conduct ongoing monitoring of their merchant portfolio. Chargeback ratios that breach Visa and Mastercard thresholds, compliance gaps identified during audits, or unexplained transaction volume spikes can trigger account review, suspension, or termination — even after years of clean processing history. Compliance must be treated as a live operational function with clear ownership, regular audits, and a budget that reflects its importance to business continuity.
Understanding the full cost of payment processing matters both for financial modelling and for evaluating processor proposals. The fee structure for high-risk merchant accounts is more complex than for standard merchant accounts, and the rolling reserve in particular has a meaningful impact on working capital during the early months of operation.
| Fee Type | Typical Range (2026) | Notes |
|---|---|---|
| Merchant Discount Rate (MDR) | 2.5% – 5.0% per transaction | Core processing fee; varies by corridor risk, volume, and chargeback history |
| Rolling Reserve | 5% – 10% of monthly volume | Held 90–180 days; released on a rolling basis. Has direct working capital impact |
| Monthly Gateway Fee | $100 – $500 / month | Fixed platform access and maintenance fee charged by most specialist processors |
| Chargeback Fee | $25 – $50 per dispute | Applied to every disputed transaction regardless of outcome |
| Setup / Underwriting Fee | $500 – $2,500 one-time | Charged by some processors at account approval — not universal |
Figure 6: Typical payment processing cost structure for remittance companies with high-risk merchant accounts in 2026
These figures represent typical ranges observed in the market. Actual rates vary based on processing volume, corridor risk profile, chargeback history, and the specific processor. Higher-risk corridors may attract higher MDR rates or additional reserve requirements. As processing history builds and chargeback ratios remain clean, the case for rate renegotiation becomes stronger. Most processors are willing to discuss revised terms after six to twelve months of positive processing performance.
The primary option for most remittance operators. Specialist acquirers have developed underwriting frameworks specifically for regulated financial services businesses, including MSBs. They carry higher fees and reserve requirements than standard merchant accounts, but they provide card-network-connected processing — Visa and Mastercard access — that is essential for consumer-facing remittance operations.
An increasingly important category for remittance operators, particularly those building modern, API-first operations. BaaS platforms designed for licensed financial services businesses provide multi-currency virtual accounts, local payout rails, FX conversion, API-based compliance tooling, and in some cases, end-to-end payment processing infrastructure. These platforms are purpose-built for the operational complexity of cross-border money movement and reduce the burden of building individual processing relationships from scratch.
For operators processing high volumes across multiple corridors, payment orchestration platforms connect to multiple acquiring banks and route transactions dynamically based on cost, approval rate, and geographic coverage. This architecture reduces single-point-of-failure risk, can improve transaction approval rates across diverse markets, and gives operators greater control over cost optimisation as their volume grows.
Available only to established, well-capitalised remittance operators, direct correspondent banking relationships provide the deepest integration and the greatest control over funds flow. Building these relationships requires substantial capital, demonstrated regulatory standing, and industry relationships developed over time. They are not a realistic option for early-stage operators, but represent the natural long-term trajectory for businesses that scale successfully.
The majority of payment gateway rejections in the remittance sector are avoidable. The most common errors operators make when applying include:
No. A Money Transmitter License (MTL) or equivalent money services business registration is a prerequisite for payment gateway approval in the remittance sector. No legitimate specialist processor will onboard a remittance business without verifying active licensing. In the United States, FinCEN MSB registration is the minimum federal requirement and must be in place before any gateway application is submitted. Operating a remittance service without appropriate licensing also constitutes an illegal money transmission offence under federal law and in most US state jurisdictions.
Payment gateway approval for a remittance company typically takes two to eight weeks with a specialist high-risk processor, provided documentation is complete at the time of application. Incomplete applications extend this timeline significantly. If licensing is still in progress, the approval timeline extends by the relevant licensing processing period, which ranges from 60 days to over 12 months depending on jurisdiction.
High-risk merchant accounts for remittance businesses typically involve a Merchant Discount Rate (MDR) of 2.5% to 5% per transaction, monthly gateway fees of $100–$500, a rolling reserve of 5% to 10% of processed volume held for 90 to 180 days, and per-chargeback fees of $25 to $50 per dispute. These fees are higher than standard merchant account rates and reflect the compliance and risk overhead of underwriting a money services business.
No. Both Stripe and PayPal explicitly exclude money transfer and remittance businesses from their Acceptable Use Policies in most jurisdictions. Applying through these platforms risks account rejection or termination. A terminated account can contribute to placement on the Terminated Merchant File (MATCH list), which negatively affects future processor applications across the industry for up to five years. Remittance operators should apply exclusively to high-risk specialist processors with documented MSB underwriting experience.
A rolling reserve is a risk management mechanism used by high-risk merchant account processors. The processor withholds a set percentage — typically 5% to 10% — of each transaction processed and holds it in a reserve account for a defined period, usually 90 to 180 days. The reserve is released on a rolling basis once the holding period expires. For a business processing $100,000 per month at a 10% reserve rate, $10,000 of monthly revenue is held back during the first six months. This has a direct working capital impact and must be modelled explicitly in cash flow projections.
Yes, but with additional requirements. Startup remittance companies without transaction history will need to provide a detailed business plan with projected volumes, complete licensing documentation, a fully documented AML/KYC program, and a qualified Compliance Officer in place. Initial processing limits will be lower and reserve requirements higher than for established operators. These conditions typically become negotiable after 90 to 180 days of clean processing history.
The MATCH list (Mastercard Alert to Control High-Risk Merchants), also known as the Terminated Merchant File (TMF), is a shared industry database of merchants whose accounts have been terminated by acquiring banks — typically for excessive chargebacks, fraud, or compliance violations. Appearing on the MATCH list makes it extremely difficult to obtain payment processing with any legitimate acquirer for up to five years. This is why remittance operators must avoid applying to standard gateways that will reject or terminate them, and must maintain chargeback ratios below Visa and Mastercard thresholds at all times.
Not necessarily. Many specialist processors and BaaS platforms support multi-corridor operations through a single integration, handling multiple currencies, local payment methods, and international payout rails. However, every country where you operate as a money transmitter requires its own local regulatory license or registration. Payment gateway coverage and licensing jurisdiction are separate and parallel requirements — both must be addressed.
The payment gateway challenge that remittance companies face is real, consistent, and structural — but it is solvable for operators who approach it with the right preparation and the right sequencing. The businesses that navigate it successfully are those that treat licensing and compliance not as barriers to get past, but as the operational foundation that makes everything else possible.
Complete your licensing before you apply. Build your compliance program to a standard that would satisfy a regulator, not just a checkbox. Prepare underwriting documentation that answers every question before it is asked. Apply exclusively to processors with demonstrated MSB underwriting experience. And build redundancy into your processing infrastructure from day one.
The global remittance market is large, growing, and serves a population that depends on it. The payment infrastructure challenge is real, but it is not insurmountable. For operators who build the compliance and licensing foundation correctly, the door to reliable, sustainable payment processing opens.
