| Date: | 09/22/2026 |
|---|---|
| Organization: | Division of Banks |
| Location: | Boston, Massachusetts |
September 22, 2026
Tope Alabi
Chief Executive Officer
Afriex Inc.
251 Little Falls Drive
Wilmington, Delaware 19808
Dear Mr. Alabi:
This letter is in response to your correspondence dated March 29, 2026 on behalf of Afriex Inc. (Afriex) in which you request an advisory opinion that the activities of Afriex do not require a money transmission license pursuant to M.G.L. c. 169B. In addition to your request for an advisory opinion interpreting M.G.L. c. 169B, you also seek an opinion as to the applicability of now-repealed M.G.L. c. 169 to the same facts.
Established in 2020, Afriex is a Delaware corporation offering cross-border payment solutions to individuals and businesses. As described in your correspondence, Afriex utilizes a pre-funded disbursement model for its cross-border payment solutions service. Each transaction through Afriex follows the sequence described below:
- A customer initiates a remittance transaction and authorizes Afriex to charge their debit card. As described in your letter, this authorization places a temporary hold on the customer's funds but does not transfer those funds to Afriex. This pre-authorization hold is maintained by the customer’s card network and the customer's issuing bank.
- Prior to any funds moving from the customer to Afriex, Afriex immediately disburses the specified amount to the designated recipient's mobile wallet or bank account in Africa from Afriex's own pre-funded master disbursal account.
- Your request states that only after the ultimate recipient has received the funds does Afriex convert the temporary card hold to a payment/post status to reimburse itself for the disbursement already made.
Your submission also included a set of example transactions, including the relevant timestamps for each step in the transactions. As set forth in the example transactions, the typical timeframe between the customer’s initiation of a transaction (when the hold is placed on the customer’s debit account) and Afriex’s conversion of the hold on the customer’s debit account is approximately thirty seconds.
Your correspondence emphasizes that although there is a hold on the customer's debit card at the time of authorization when the customer enters into the transaction with Afriex, that hold is maintained by the customer’s card network and the issuing bank for the customer’s debit card — not by Afriex. Your request further represents that Afriex has no ability to direct, spend, or transmit the held funds, and can only issue instructions to the card network to convert or release the hold. According to your description, the funds subject to the hold never enter any Afriex-controlled account during the “transmission window.”
Chapter 169B defines “Money transmission'', as either:
(i) selling or issuing payment instruments to a person located in the commonwealth; (ii) selling or issuing stored value to a person located in the commonwealth; or (iii) receiving money for transmission from a person located in the commonwealth; provided, however, that money transmission shall only refer to transactions engaged in by a person for personal, family or household purposes and shall not include the provision solely of online or telecommunications services or network access.
Further, ''[re]ceiving money for transmission'' or ''money received for transmission'', is defined as “receiving money or monetary value in the United States for transmission within or outside the United States by electronic or other means.” In addition, M.G.L. c. 169B, § 4(a) provides, in pertinent part:
(1) A person shall not engage in the business of money transmission or advertise, solicit or hold itself out as providing money transmission unless the person is licensed under this chapter.
Now-repealed M.G.L. c. 169, § 1 required foreign money transmitter licensure for “all persons who engage or are financially interested in the business of receiving deposits of money for the purpose of transmitting the same or equivalents thereof to foreign countries.” Both statutes utilize the word “receiving”. It is Afriex’s contention that it does not actually receive the requesting consumer’s funds for transmission within the meaning of the statute because the debit transaction is not settled and the consumer’s funds are not released to Afriex until after an equivalent amount of funds have been disbursed to the ultimate recipient from Afriex’s local account. As noted, the typical timeframe between the consumer’s initiation of a transaction (when the hold is placed on the customer’s debit account) and Afriex’s conversion of the hold on the customer’s debit account is approximately thirty seconds.
The Division is not persuaded that Afriex’s business activities do not constitute money transmission within the meaning of M.G.L. c. 169 or M.G.L. c. 169B. By placing a hold on a consumer’s debit card account, the consumer’s available balance is reduced by the hold amount, and the consumer no longer has access to those funds. While Afriex emphasizes that the hold is maintained by the customer’s card network and the issuing bank, it is Afriex who unilaterally controls whether the hold is placed, whether it is released or whether the transaction is settled. Only Afriex can release the hold or settle the transaction, thereby vesting Afriex with the authority to unilaterally determine the outcome of the hold. In this way, Afriex is exerting control over the consumer’s funds tantamount to receipt. Moreover, the Division notes that the purpose of a consumer’s transaction with Afriex is purely to transmit funds to a recipient. It would undermine the purpose of both statutes to exempt such prefunded models from money transmission licensure and regulation.
Moreover, for purposes of M.G.L. c. 169B, the law was modeled on and overwhelmingly incorporated the language of the Model Money Transmission Modernization Act (MTMA). The MTMA, developed by industry and state experts and approved by the Board of Directors of the Conference of State Bank Supervisors (CSBS), creates a single set of nationwide standards and requirements for money transmission. In interpreting M.G.L. c. 169B, section 12 requires that the Division give consideration to the need to promote uniformity among states that have enacted the MTMA, stating: “[i]n implementing and interpreting this act, consideration shall be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.” The Division notes that Afriex is currently licensed as a money transmitter by the Missouri Department of Finance. Missouri adopted the MTMA in 2024. See 2022-2026 Money Transmission Modernization Act Proposed and Enacted Legislation. The Division’s conclusion is therefore further supported by section 12 of M.G.L. c. 169B and the purpose of the MTMA.
For the foregoing reasons, the Division concludes that the licensing requirements of both M.G.L. c. 169 and M.G.L. c. 169B apply to Afriex. The conclusions reached in this letter are based solely on the facts presented. Fact patterns which vary from those stated above may result in a different position statement by the Division.
Sincerely,
Christine A. Docherty
Deputy Commissioner and General Counsel
- ^MTMA Legislative Update_4.23.2026.pdf (last visited September 22, 2026).