Remittance rule kicks in, compliance resources online
Oct. 29, 2013 – CFPB’s final international remittance rule is now in effect, and NAFCU and CFPB have provided some useful resources to help credit unions comply.
The final rule requires credit unions and other institutions providing international remittance services to provide consumers up-front information about the exchange rate, fees and taxes the sender will pay; information on the amount to be received on the other end and the consumer’s right to cancel most transfers within 30 minutes, at no cost. Errors generally must be reported within 180 days.
Credit unions can find information and resources on the final rule on the NAFCU Compliance Blog; check the remittance category, which stores all posts on that topic. NAFCU’s September Compliance Monitor also has a detailed description of the remittance rule.
NAFCU had concerns about the proposed rule, and CFPB took some of these into account in setting its final rule by scaling back disclosures of foreign taxes. However, the rule still imposes several costly requirements that NAFCU is concerned will encourage many credit unions to leave the market or sharply reduce their presence.
Earlier this year, findings of a NAFCU Economic & CU Monitor survey indicated that more than half of credit unions surveyed said they would exceed the 100-remittance transfer safe harbor for exemption from the rule’s requirements. Also, about 27 percent, including one credit union that averages 25,000 remittances per year, said they would drop their remittance program as a result of the final rule.
CFPB offers some resources for credit unions:
For consumers, CFPB launched a nationwide multimedia campaign to inform consumers who send money internationally about new protections that went into effect on Monday.
CFPB final remittance rule
NAFCU Compliance Blog
NAFCU Economic and CU Monitor