Anyone in Minnesota engaged in the business of collecting for others accounts, bills or other types of debt must obtain a Minnesota collection agency license. This license is issued and regulated by the state Department of Commerce.
The licensing process is fairly straightforward and requires applicants to complete an application form, post a Minnesota collection agency bond, as well as to pay a license fee. For a full breakdown of the process of getting a Minnesota collection agency license, see the steps below!
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1. Register Your Business in the State
Before you can apply for your collection agency license, you will need to register your business with the Office of the Minnesota Secretary of State.
This step is necessary as you will be required to provide proof of having filed with the Secretary of State when you are applying for your license.
2. Apply For Your Minnesota Collection Agency License
To get a collection agency license, you must apply online through the Pulse Portal. Select the Minnesota Department of Commerce when asked for a program, and Debt as the Board.
You will then be provided with instructions on completing the application. If you plan on opening a branch location, you will need to apply for a separate license for it.
3. Get a Minnesota Collection Agency Bond
As part of your application, you will need to submit a Minnesota collection agency bond that guarantees your compliance with the Minnesota Statutes, and in particular Chapter 332. The amount of your surety bond will likely be $50,000 when you are applying for the first time.
When you apply to renew your license and bond at a later time, the amount can vary between $50,000 and $100,000 and is determined on the basis of collections during the previous year. An additional $5,000 are added to the bond for every $100,000 received by the agency from debtors in the state during the previous calendar year.
You can get a free and exact quote on your bond by completing the simple bond form below!
4. Complete the Licensing Requirements
As part of your application, you will need to submit some of the following supporting documentation:
- Business registration documents
- Formation certificates
- Certificate of an assumed name (if applicable)
- A completed “Disclosure of Owners, Partners, Officers” form
- A Minnesota collection agency bond
Along with the above, you will also need to pay a $1,000 licensing fee. The fee for branch locations is $500. When you have completed the application, you will need to wait for confirmation from the Department.
5. Renewing Your Minnesota Collection Agency License
Licenses and bonds are renewed yearly through the Pulse Portal with the renewal period being between May 1 and June 30.
The renewal process also involves the requirement to have screened every debt collector of the agency. The screening process must include a national and county criminal history record search.
Do you have any further questions about the licensing process for Minnesota collection agencies? Get in touch with the Department of Commerce at 651-539-1600 or [email protected]!