Proposed EFTA rule on remittance transfers would create burdens, consumer confusion
The CFPB’s proposed rule on remittance transfers under the Electronic Fund Transfer Act (EFTA) brings concerns about regulatory burden, which could be significant for some credit unions. America’s Credit Unions outlined these concerns in a letter submitted Monday to the agency
The proposal would amend certain remittance transfer disclosure requirements in Regulation E and clarify that consumers should contact their remittance company for issues specific to their money transfer. Credit unions that offer remittance transfers would need to update disclosures made after the effective date but would not be required to send updated disclosures for disclosures made before that date.
America's Credit Unions urges the bureau to consider modifications to the proposed rule to ensure that it achieves its objectives without imposing disproportionate burdens on credit unions, especially smaller institutions.
The letter notes the proposed rule would be burdensome to implement and requires additional clarity, arguing that:
- The CFPB’s estimated compliance cost falls short of actual needs, and credit unions would need one year to successfully manage new operational adjustments;
- The rule includes vague and unclear terms that could cause confusion for consumers and less uniform disclosures; and
- Changes that redirect remittance complaints away from the CFPB could shift the Bureau’s supervisory focus toward its own priorities rather than consumer-identified issues.