Who requires it
South Dakota Division of Banking — Money transmitters
License & permit · South Dakota
South Dakota Money Transmitter Bond
Every South Dakota money transmitter must keep security on file with the Division of Banking. SDCL 51A-17-100 sets the amount as the greater of $100,000 or 100% of average daily South Dakota transmission liability for the latest three-month window, capped at $500,000. Firms whose tangible net worth is more than 10% of total assets post a flat $100,000 instead. With the director’s approval, a deposit can replace the bond. File through NMLS and keep the security active for the license year ending December 31. If you already post $500,000, you do not have to keep recalculating average daily liability.
Common bond amount
$100,000–$500,000
Greater of $100,000 or 100% of average daily SD liability (3-month), max $500,000; or $100,000 if tangible net worth exceeds 10% of total assets. Deposit may substitute with director approval.
How you file
File electronically through NMLS; director-approved deposit may replace the bond
Renewal
Keep the bond active while licensed. Raise the amount if average daily South Dakota liability grows.
Who requires it
Applicants for and holders of South Dakota money transmission licenses under SDCL chapter 51A-17 filing with the Division of Banking.
How much is required
Start with the firm’s average daily South Dakota transmission exposure for the last finished three-month stretch. The required amount is whichever is higher—that exposure figure or $100,000—subject to a $500,000 ceiling. Skip the liability comparison and stay at $100,000 when tangible net worth is more than ten percent of total assets. Ask the director before substituting an approved deposit for the surety bond.
How to get and file it
Confirm the applicable amount under SDCL 51A-17-100, arrange a surety bond or director-approved deposit in the exact licensee name, and file the bond electronically through NMLS as Banking instructs. Keep the bond or deposit active for as long as the money-transmitter license remains open. When South Dakota average daily exposure climbs, raise the bond or deposit before it falls short of the statutory comparison. Companies already at the $500,000 ceiling can rely on the statute’s relief from ongoing average-daily calculations. Renew the December 31 license through NMLS each year.
Cost note
The formula result is the required bond amount, not the premium you pay. Approved deposits are alternatives, not free coverage. See bond amount vs premium. Bond amount vs premium →
Requirement checklist
- Standard formula
- Greater of $100,000 or 100% of average daily SD money transmission liability (latest 3 months)
- Maximum under formula
- $500,000
- High tangible-net-worth path
- $100,000 if tangible net worth exceeds 10% of total assets
- Alternative
- Director-approved deposit instead of bond
Official sources
Related resources
Frequently asked questions
Can I use a deposit instead of a surety bond?
Only after the director approves a deposit in place of the bond under SDCL 51A-17-100. Treat deposit authority as case-by-case—not automatic.
Do I still calculate liability if I already post $500,000?
When you already hold the maximum amount the statute calls for, you are not required to keep calculating average daily South Dakota transmission liability for this bonding section.
Related South Dakota bond guides
Mortgage Lender / Broker Bond
$25,000–$50,000
South Dakota mortgage lenders, brokerages, brokers, and originators must keep a surety bond under SDCL 54-14-24. That statute sets a $25,000 floor and requires an amount that reflects loan volume. ARSD 20:07:19:07 provides the current schedule: $25,000 when prior-year South Dakota originated, brokered, or serviced volume is under $25 million; $35,000 from $25 million through $100 million; and $50,000 above $100 million. An employed or exclusive-agent originator or broker may be covered by the employer’s bond. Keep the bond active while licensed. The surety may cancel on 30 days’ notice to you and the director. If a claim is paid, file a replacement right away.
Money Lender Bond
≤ $10,000 + $2,500 per additional license
South Dakota money lenders—including payday and title lenders licensed under chapter 54-4—must file a surety bond with the license application. SDCL 54-4-42 caps the amount at $10,000 for the first license and $2,500 for each additional license. That is a statutory maximum, not a figure we have verified as the amount Banking currently requires in every case. Confirm the exact amount with the Division of Banking for your location count before filing. The bond protects the state and people with claims under chapter 54-4. Some nonprofit and development entities must still be licensed but are exempt from the bond.
Motor Vehicle Dealer Bond
$5,000–$25,000
South Dakota vehicle and specialty dealers file a surety bond with the Department of Revenue Motor Vehicle Division before the matching dealer license issues. Amounts are $25,000 for vehicle, used-vehicle, or manufactured/mobile-home licenses; $20,000 for boat; $10,000 for emergency-vehicle or for trailers over 3,000 pounds; and $5,000 for motorcycle/off-road or snowmobile. Boat dealers may use one bond for several dealer licenses if the amount covers every license. The bond protects customers if the dealer fails on title, commits fraud, or breaks a lien warranty. Keep a current bond for each license period. If a claim is paid after a judgment, bring the bond back to the required amount. The surety must notify the department in writing of paid claims or cancellations.
Surety basics (not repeated here)
Universal surety concepts explained once—linked here instead of repeated on every state or bond page.
Continue with a South Dakota application
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Last verified 2026-08-12. This guide is based on verified educational content and official sources.
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