Key Differences Between Money Changer and Remittance License in Singapore
Explore the key differences between money changers and remittance licenses in Singapore. Learn about requirements and benefits for entrepreneurs and business owners.

When it comes to conducting financial transactions or operating a business in the financial services sector in Singapore, understanding the licensing requirements is essential. If you're an entrepreneur looking to expand your business globally, you might be considering a financial services venture in Singapore. Two important licenses in this sector are the money changer license in Singapore and the remittance license. Both are issued by the Monetary Authority of Singapore (MAS), but they serve distinct purposes and come with different regulatory obligations. In this post, we will break down the key differences between the two licenses, so you can make an informed decision for forming a company in Singapore.
What is a Money Changer License in Singapore?
A money changer license in Singapore is required for businesses that deal with the exchange of foreign currencies. As a money changer in Singapore, your main business activity will involve converting one currency into another. This is particularly relevant for travelers and businesses that need to conduct international transactions.
In order to apply for a money changer license in Singapore, you must ensure that your business complies with the regulatory framework set by MAS. This includes having appropriate systems in place to manage the risk of money laundering and the financing of terrorism, among other financial crimes. You must also ensure that your business maintains a proper record of all transactions, and abide by the limits on the amount of foreign currency you are allowed to exchange.
Key features of a money changer license include:
- Currency Exchange: Your primary activity will involve exchanging one form of currency for another.
- Operational Scope: Money changers are permitted to operate physically at locations such as airports, malls, or other high-traffic areas where people are likely to need foreign currency.
- Regulatory Oversight: The MAS requires businesses holding a money changer license to comply with anti-money laundering (AML) and counter-terrorism financing (CTF) laws.
- Minimum Capital Requirements: Money changers must meet minimum financial criteria and demonstrate the ability to manage their business operations effectively.
For businesses that plan to cater primarily to tourists or international customers who need quick, efficient currency exchange, a money changer in Singapore can be a profitable venture. However, it is important to comply with all regulatory requirements to ensure smooth operations and avoid potential legal issues.
What is a Remittance License in Singapore?
On the other hand, a remittance license is required for businesses that facilitate the transfer of funds between individuals or businesses, either domestically or internationally. Remittance refers to the act of sending money from one person to another, often across borders. This type of license is more applicable to businesses offering services such as money transfers, sending remittances back home for migrant workers, or enabling international money transfers for individuals and businesses.
While both money changers and remittance service providers are involved in financial transactions, their operations and scope differ. The key distinction lies in the type of service being offered — money changers deal with currency exchange, while remittance services are about transferring funds.
Key features of a remittance license include:
- Money Transfer Services: This license covers businesses offering money transfer services, allowing you to send funds from one location to another, both within Singapore and internationally.
- Clientele: Remittance services are typically used by individuals who need to send money to family or friends abroad, or businesses making cross-border payments.
- Compliance Requirements: Remittance businesses are also subject to stringent regulatory controls to prevent money laundering and terrorism financing. The regulatory framework is similar to that of money changers, but the focus is on monitoring the transfer of funds rather than just currency exchange.
- Cross-Border Transactions: Unlike money changers who primarily exchange currency, remittance service providers focus on facilitating international payments and transfers.
Key Differences Between Money Changer and Remittance Licenses in Singapore
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Business Focus:
- A money changer license in Singapore is focused on currency exchange, while a remittance license is for businesses that facilitate fund transfers.
- If you plan to offer both services, you might need to apply for both licenses.
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Types of Transactions:
- Money changers exchange physical currencies from one type to another, often done at physical locations like kiosks or offices.
- Remittance businesses focus on facilitating money transfers, which can be either domestic or international, through various methods like wire transfers or digital payments.
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Regulatory Oversight:
- Both licenses fall under the supervision of the Monetary Authority of Singapore (MAS), but the specific regulations vary. While both types of businesses are required to comply with AML and CTF regulations, the risk factors differ, especially for remittance services, which are more likely to involve cross-border transactions.
- For money changers, the primary concern is ensuring that the correct exchange rates are used and preventing the use of counterfeit currency.
- For remittance providers, there is a higher emphasis on tracking the movement of funds and ensuring that the sender and receiver are legitimate.
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Target Market:
- Money changers cater mainly to individuals or businesses who need to physically exchange currencies, such as tourists or international travelers.
- Remittance businesses are often used by individuals who need to send money back home to family or friends, or businesses making international payments.
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Business Setup:
- The process for obtaining either license involves applying the MAS, but the specific documents and requirements differ.
- For a money changer in Singapore, your business must have physical premises and meet the required capital thresholds.
- For remittance services, you must ensure that your business has the necessary systems in place to track and facilitate transfers securely.
How to Set Up Your Financial Services Business in Singapore
If you're looking to establish a financial services business such as a money changer in Singapore or a remittance service provider, it's essential to go through the process of Company Formation in Singapore. Setting up your business legally involves several steps, including registering your company with the Accounting and Corporate Regulatory Authority (ACRA), obtaining the necessary licenses, and ensuring compliance with regulatory requirements.
Engaging with a corporate services provider can help streamline the process, ensuring that you meet all legal and financial criteria. Whether you’re applying for a money changer license in Singapore or a remittance license, having the right expertise and knowledge will help you navigate the licensing process smoothly.
Conclusion
Both money changer licenses and remittance licenses are essential for businesses that wish to engage in foreign exchange or money transfer services in Singapore. While they may seem similar at first glance, they serve different purposes and come with distinct regulatory requirements. Understanding these differences will help you decide which license is appropriate for your business.
If you plan to offer both services, you’ll need to ensure that you comply with the regulations for each. Working with a professional service provider can make the process easier and help you stay compliant with Singapore’s laws.
FAQs
1. Can I apply for both a money changer and remittance license in Singapore?
Yes, you can apply for both licenses if your business intends to offer both currency exchange and money transfer services. You will need to meet the regulatory requirements for each.
2. What is the minimum capital required to apply for a money changer license in Singapore?
The minimum capital required for a money changer license varies depending on the size and scope of your business, but it generally ranges from SGD 100,000 to SGD 200,000.
3. How long does it take to get a money changer or remittance license in Singapore?
The process of obtaining a license can take several weeks to a few months, depending on the complexity of your application and whether all regulatory requirements are met. Be sure to plan ahead and allow enough time for approval.
Also Read: Procedure for License of Finance Company in Singapore
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