Money service businesses need cash vaulting and armored cash delivery services to support their operations. Access to the cash vault of a local depository institution enables an MSB to place cash orders and arrange for the funds to be delivered to their business. Cash logistics are essential to MSB operations since check cashing clients rely on their neighborhood money service business to cash payroll checks and perform routine financial activities. A gap in cash flow leaves an MSB unable to serve its clients and results in temporary or permanent business closure.
Before we discuss cash vaulting, it is important to note the other MSB banking services required to operate a check cashing business. First and foremost, MSBs need real, reliable MSB bank accounts. A solid bank account is essential to daily operations and without it, an MSB can not stay in business. Both licensed and unlicensed MSBs need to secure a bank account through a financial institution. Whether you are a licensed MSB cashing over $1,000 per customer per day or a smaller unlicensed retail check casher, you need an MSB bank account.
Securing a bank account for your check cashing business is harder than it sounds since the banking industry continues to engage in indiscriminate derisking. Rather than managing the risk associated with a bank account, financial institutions are choosing to shut down the bank accounts entirely to avoid the risk. This derisking activity leaves MSBs unbanked on short notice, creating a business nightmare.
NCC works with MSBs who are searching for reliable banking or those who have already lost their bank accounts. Some clients find NCC upon receiving notice of abrupt account termination after 25 plus years with a bank. In these cases, no explanation is offered for termination accounts in good standing. The MSBs simply received a letter with 30 days warning that their account will close as the bank restructures their approach to risk management.
Compliant MSBs with a secure bank account still need additional supportive financial services to run efficiently and profitably. These MSB services include extended deposit times, wire transfer capabilities, compliance guides, check cashing processes, POS technology, and cash logistics. Together, these services allow an MSB to operate in compliance with federal regulation and to focus on serving their check cashing customers.
Without a cash vault, MSBs typically wait up to three business days or longer to receive cash from their deposited items (funds from cleared checks). In some cases, MSBs are not able to receive cash easily from their funds locally and have to travel to great lengths to stay operational. These MSBs are left in a lurch, scrambling to find cash to cover their daily flow of checks.
MSBs with a local banking partner are able to turn deposits into cash easily. Unfortunately, derisking has made local banking partners difficult to find. One of the consequences of derisking is the restriction of cash logistics services. As banks terminate MSB bank accounts and shut down their MSB banking departments, the pool of potential financial institutions for MSBs dwindles.
With cash vaulting services and armored cash logistics, MSBs can rotate their working capital efficiently. The MSB no longer has to secure a bank account with a local depository institution. Even better, MSBs can work with NCC to gain access to an entire network of cash vaults and armored courier services. This allows MSBs to operate virtually, or apart from a local bank.
MSBs can use cash vaulting and armored courier services to order and receive “next day” cash in their local markets. This eliminates gap in cash flow and keeps MSBs operating at full capacity. The cash vault is an actual vault at a local bank where cash is stored. MSBs can place cash orders every day to request cash from their deposited funds. This cash is then transported from the cash vault to the MSB business location by an armored cash courier.
With cash worries solved, MSBs can focus on growing their business through customer loyalty programs, cross promotions, and community initiatives. When paired with a real MSB bank account, cash vaulting ensures that MSBs never have to close unexpectedly due to derisking or logistical cash flow issues.
National Check and Currency offers cash vaulting and armored courier services as part of their cash logistics for MSBs. Through NCC, MSBs in Southern California, the New York Tri State area, and Southern Florida can receive next day cash delivery of funds. These cash logistics are in addition to the myriad of supported banking services NCC provides. Since 2007, NCC has grown to better serve the MSB community with comprehensive compliance solutions, refined check cashing processes supported by the latest technology, and around the clock customer support.
During a time when derisking is the norm, MSBs have a true partner in NCC.