State Money Transmitter Rule Slams PFs, ISOs

Late last month, Pennsylvania issued an advisory that its money transmitter regulations are violated when payments companies–payment facilitators and ISOs–collect money from consumers and forward it to nonprofits and religious organizations. And yes, this advisory is as crazy as it sounds.

Whether or not other states follow the Keystone State’s lead, this decision will have devastating consequences for emerging payment companies, especially those who do not have the resources of traditional old line processors. Many may well be faced with the prospect of either banning Pennsylvania consumers or leaving the nonprofit and religious processing space.

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