Does a startup need a money transmitter license to offer a closed-loop gift card system for SMBs?

This depends on your definition of a closed loop and the regulator’s definition of a closed loop. In most cases, a closed loop is defined as a company/merchant issuing a card that has points or value, that can be redeemed only at the company/merchant’s place of business.

So if you’re say CompanyX and you issue gift cards that can be used in all your CompanyX stores and can be loaded/unloaded only in your stores, this would be fine in many jurisdictions and qualify as a closed loop.

However, from your mention, you are providing loop gift card services to CompanyA, CompanyB, CompanyC, …. see the difference here.

You would not be deemed a closed loop system in certain jurisdictions, especially if the cards can be purchased from any of these stores to be loaded (even if the unloading has to be via purchasing goods/services from these companies).

The only way around is:

• No public loading of funds on the card
• No public offloading of funds on the card
• No public sale of the card.
• Card must ONLY be issued by companies, lets say CorporateIncA, CorporateIncB, CorporateIncC, etc. issue card to their employees, and the bonuses or gifts, etc. these companies want to give, they transfer to these gift cards.
• So now these gift cards can ONLY be used at the stores.
• The gift card issuance is ONLY via CorporateInc companies
• Multi Net in Turkey is one such example, study it.

Long and short, what you are saying would qualify as a Money Transmitter IMHO even though IANAL.