Licensing Insights: State Updates + Independent Assessment Spotlight

State Updates

‍Colorado Model Money Transmission Modernization Act - Effective August 6, 2025Signed into law on April 18, 2025, Colorado’s adoption of the model Money Transmission Modernization Act (or “MTMA”) will become effective on August 6, 2025. The MTMA adoption will replace the existing Colorado Money Transmitters License requirements, including several modifications to existing requirements and exemptions:

• Net Worth: The minimum amount will increase from $50,000 (increased per location) to $100,000 (increased based upon volume).
• Electronic Surety Bond: The minimum amount will decrease from $1,000,000 to $250,000.
• Exemptions: Codifies payroll processors and agent-of-the-payee exemptions.

To review the new law, please see the Colorado General Assembly website for House Bill 25-1201.

Massachusetts to Transition to Money Transmitter License

As part of the money transmitter statutory framework adjustments made in 2024, Massachusetts will transition existing Foreign Transmittal Agency and Check Seller licensees to a new Money Transmitter license type during the 2025 renewal cycle.

According to the Massachusetts FAQs (last updated May 21, 2025), any existing licensee in good standing will be required to submit a license transition request through the Nationwide Multistate Licensing System (NMLS) beginning November 1, 2025. The transition will align license holders under the newly created Money Transmitter License.

For any new applicants who were not previously Foreign Transmittal Agency licensees, the Division will start accepting applications through the NMLS on or about July 1, 2025.  However, please keep in mind that no money transmitter licenses will be issued before January 1, 2026. New applicants must file an application for a money transmitter license on or before July 1, 2026, if they wish to continue conducting business while the application is pending.

Importantly, the NMLS transition checklist will differ from prior renewal requirements, reflecting the updated standards under the Money Transmitter framework. Additional details on the process will be made available in the coming months. For more information, you can refer to the Massachusetts FAQ document.

Maryland Exempts Certain Mortgage Trusts from Licensing

The Maryland Office of Financial Regulation (OFR) has rescinded prior guidance and proposed regulations following the enactment of House Bill 1516, effective April 22, 2025. The new law exempts two types of trusts from Maryland’s mortgage lender and installment loan licensing requirements:

Passive Trusts – Trusts that acquire or are assigned mortgage loans but do not originate, broker, or service them.

Government Trusts – Trusts created by U.S. government entities to acquire mortgage loans.

These changes are effective immediately and apply regardless of the trust’s state of formation. Entities should consult counsel to determine eligibility.

HB1516 also establishes a Licensing Workgroup to review Maryland’s financial licensing framework and recommend improvements by December 31, 2025.

Other Notable Upcoming Effective Dates for Money Transmission

• Illinois Uniform Money Transmission Modernization Act: An adopting of the MTMA, Senate Bill 3412 goes into effect on January 1, 2026. Additional information can be found on the Illinois General Assembly website for Senate Bill 3412.
• Mississippi Money Transmission Modernization Act: The Act would repeal the existing Mississippi Money Transmitters Act and replace it with an adoption of the MTMA. House Bill 1428 would go into effect on July 1, 2025. Additional information can be found on the Mississippi bill-status website for House Bill 1428.
• Nebraska MTMA Adoption: Alongside edits to the Nebraska Installment Sales Act, Legislature Bill 474 adopted the MTMA on May 21, 2025. The provisions of this Act will become effective on October 1, 2025. Additional information can be found on the Nebraska bill-status website for Legislature Bill 474.
• Virginia MTMA Adoption: On March 21, 2025, the Governor of Virginia signed into law House Bill 1942, which would adopt the MTMA. The law is effective on July 1, 2026. Additional information can be found on the Virginia bill-status website for House Bill 1942.

For more information or help evaluating how these changes may affect your licensing requirements, please contact FS Vector.

Service Spotlight: Independent Assessments

An increasing number of states are requiring licensees complete independent review of their compliance programs as part of application for licensure. Additionally, licensed entities are expected to comply with state requirements that compliance programs be subject to regular independent testing and review.

FS Vector’s Independent Assessments provide a practical, right-sized review of your compliance program.Our team brings deep expertise in both fintech operations and compliance auditing, to ensure your independent review not only satisfies your requirement to be audited, but helps your compliance team identify gaps, manage risk, and stay ahead of evolving requirements.

Our team understands that MSBs have unique needs, and we tailor our services to fit your specific requirements. Whether you are a startup needing foundational compliance guidance or an established entity looking for advanced strategies to refine your risk management processes, our reviews are designed to ensure your compliance framework is robust, efficient, and aligned with industry standards.

In need of an audit or independent review? Visit our website to connect with a member of our team.

FS Vector Calendar

Events FS Vector Licensing Team is attending

• American Association of Residential Mortgage Regulators | August 5-7 | Fort Worth, TX
• MTRA  | Sep 8-11 | Louisville, KY
• Money20/20 | Oct 26-29 | Las Vegas, NV
• RegList on the Ocean | Nov 4-5 | Huntington Beach, CA