How should a marketplace structure its flow of funds to avoid unintentionally becoming a money transmitter?

I start by asking you to describe one transaction from beginning to end. Who is selling the product? Who charges the customer? Where does the money land? Who can direct it, and who owes the merchant their settlement?

Those details matter more than saying, “We use a licensed payment company.” Even within the same product, different configurations move money differently. Stripe Connect, for example, distinguishes direct charges, destination charges, and separate charges and transfers, with different settlement and refund responsibilities. Stripe’s funds-flow documentation.

The aim is to choose a supported arrangement in which the provider’s role, your role and the merchant’s rights are clear. Taking your commission within that arrangement is different from improvising an additional collection-and-payout step through your operating account.

Pay particular attention when expanding internationally. If a merchant cannot use the original settlement setup and you propose receiving their money yourself before paying them through another service, review that new flow before launching it. Automation or holding the money only briefly does not settle the legal question.

There may be relevant exemptions, but their conditions must actually be met. FinCEN’s federal payment-processor exemption has specific requirements concerning the underlying sale, settlement system and agreements; state licensing needs a separate review. FinCEN’s payment-processor ruling.

My recommendation is to have the provider and qualified counsel assess the documented flow, including commissions, refunds and international payouts. Keep the implementation consistent with the arrangement they reviewed.