Why might someone buy a money service business in Canada even though they are not doing business in Canada?

This is a great question. One of the reasons you want to buy a money service business, and that too from Canada (which is, I believe, one of the G15 or G20 countries), is that it is a legitimate way for you to interact with other providers who are licensed. It allows you to work with them.

Let me give you an example. Let's say you want to work with a provider in the UK and want to pay make-up remittances or transactions from there and you want to send these remittances or transactions to, let's say, the Philippines. The Philippine provider is registered and licensed by the Central Bank of the Philippines. The UK provider is licensed by the FCA, the Financial Conduct Authority.

When you want to work and you say, "Hey can you pick up clients, pick up transactions for me, on my behalf, from the UK?" they say, "Yep, happily, we are happy to do so." At some point in time they're going to ask, "Are you licensed?" Then you say, "No," and they say, "Well then sorry, we can't work with you. We only work with a licensed entity."

The movement of money is a licensed activity. I cannot stress this enough: the movement of money is a licensed activity. That means you need to be licensed in order to pick up that money from the UK as an aggregator and then push it out to the Philippines.

Else what you have is that they, meaning the UK provider, would work with the Philippine provider directly and you can't be in between. Here lies the problem: you want to be in between and because you want to be in between you need a license.

The Canadian license, the Canadian MSB license, is one of the relatively easy licenses. I'm not saying it's easy: it's relatively easy compared to any of the other licenses. That's what a lot of solutions from a lot of fintechs and startups, and sometimes even incumbents, go for because they say, "Hey it gives us legitimacy. It allows us to have a license. We will adhere to AML, KYC, KYB, anti-money laundering, all that stuff, and we would be legal and we would have a license." That means we can go and sign agreements with everyone rather than everyone signing agreements with each other and leaving us out of the loops. That's the advantage of having a Canadian MSB license.