The BVI Financing and Money Services Act (Revised Edition 2020), including amendments

29 Jan 2026

The BVI Financing and Money Services Act, revised as of 1 January 2020, serves as a comprehensive regulatory framework governing the financing and money services sector in the Virgin Islands. Enacted initially in 2009 and subsequently amended in 2018, the Act provides the foundation for licensing, regulation, and supervision of entities engaged in financing and money services businesses, ensuring their compliance with both financial and anti-fraud standards. It reflects the jurisdiction’s commitment to fostering a transparent, accountable financial system while protecting consumer interests.

Licensing regime and prohibited unauthorised operations

Central to the Act is its licensing regime, which requires entities to obtain official authorisation before engaging in financing and money services activities. These activities include credit provision, financial leasing, electronic money transmission, cheque cashing, and currency exchange services. The Act defines multiple classes of licences, such as Class A for money transmission services and Class C for financing businesses, ensuring tailored oversight and transparent operations. Unauthorised operations within this space are strictly prohibited, with stringent penalties in place for non-compliance.

Role of the Financial Services Commission

The Act is administered by the BVI Financial Services Commission (FSC), which plays a crucial role in supervising the financial services sector. Licensing applications are subject to rigorous scrutiny, including fit and proper assessments for directors, senior officers, and significant stakeholders. Furthermore, licence holders must maintain specific capital resource thresholds to ensure financial stability and sustain their obligations.

Corporate governance and compliance standards

Corporate governance is another critical pillar of the legislation. The Act demands that licensees establish robust management systems and internal controls commensurate with the scale and complexity of their operations. Transparent financial practices, including accurate record-keeping and regular submission of audited financial statements, are mandatory. Directors and senior officers shoulder explicit legal responsibilities to uphold compliance with the statutory framework, including measures to counter money laundering and terrorist financing.

Consumer protection and ethical market conduct

Consumer protection is a notable aspect of the Act, underscoring fairness, transparency, and the safeguarding of customer funds. Licensees are required to segregate customer funds for money transmission services, ensuring these funds are neither misused nor mingled with licensee assets. Additionally, the law imposes ethical market conduct rules, caps on certain interest rates, and prohibits exploitative fees, ensuring fair treatment of all customers. It also regulates advertising practices, mandating that promotional materials be neither misleading nor deceptive.

Supervisory powers and enforcement mechanisms

The Act grants the Commission extensive supervisory powers, ensuring compliance through routine audits, investigations, and reporting obligations. Violations of statutory requirements, such as incomplete filings or substantial breaches of obligations, can lead to administrative penalties, licence revocation, and other enforcement actions. This ensures that the financial sector operates in line with stringent regulations and accountability standards.

2020 Amendment: Transaction levy introduction

Key revisions introduced through subsequent amendments have reinforced the Act’s effectiveness. The 2020 Amendment notably introduced a transaction levy on money transmission services conducted by Class A licensees for funds sent outside the Virgin Islands. The levy, amounting to 7 per cent of the transmitted sum, is collected at the time of the transaction and paid to a “Miscellaneous Purposes Fund” established by the government. The fund allocates the proceeds towards specific uses like socioeconomic development projects, as outlined in the newly added Schedule 3. Non-compliance with levy collection attracts administrative penalties, further strengthening oversight.

2021 Amendment: Administrative efficiency in levy collection

The 2021 Amendment refined the provisions related to this transaction levy. A new subsection required the Financial Services Commission to retain a fixed sum of $10,000 from the levies collected before transferring the remaining amount to the Miscellaneous Purposes Fund. This adjustment ensures administrative efficiency and provides the Commission with additional resources to carry out its regulatory mandate.

2023 Amendment: Expanded definitions of interests

The 2023 Amendment introduced essential changes to the definitions of “controlling interest” and “significant interest.” The revised definitions expanded the scope of these terms to include not only ownership exceeding specific thresholds (10 per cent in the case of significant interest and 50 per cent for controlling interest) but also the ability to exert influence over a licensee or its decisions. The amendments also adjusted related provisions requiring both significant and controlling interests to pass the fit and proper standards set by the Commission. These changes reflect an emphasis on accountability for individuals and entities with substantial influence in the financial services sector, ensuring that they meet rigorous ethical and professional benchmarks.

A framework for sustainable growth and integrity

Together, the Financing and Money Services Act and its amendments represent a robust legal framework tailored to the unique needs of the BVI. By fostering transparency, accountability, and consumer trust, the Act reinforces the territory’s reputation as a well-regulated financial jurisdiction primed for sustainable growth and integrity in the global financial ecosystem.

Further reading