April 16, 2014 – CFPB is proposing to extend a reporting exception provided to federally insured credit unions and banks on certain international remittance transfers for another five years, to July 21, 2020.
NAFCU welcomes the proposed extension but notes ongoing concerns about the overall rule, which increases regulatory burden and costs for any credit union facilitating more than 100 remittances yearly for members. “As it stands, this rule is pushing credit unions out of the market,” said NAFCU Regulatory Affairs Counsel Angela Meyster.
The reporting exception under the current rule allows remittance transfer providers to estimate certain third-party fees and exchange rates in a remittance transfer if:
- the provider is a federally insured depository institution, including a credit union;
- the remittance transfer is sent from the sender’s account with the provider; and
- the provider cannot determine the exact amounts for reasons outside its control.
NAFCU urged this exception in discussions with and official comments to CFPB on the rule, which took effect last October. The exception is currently set to expire July 21, 2015, and CFPB has published a “safe harbor” list of countries, or destinations for which the exception may apply. CFPB notes it is authorized to extend it under the Dodd-Frank Act if the lack of it would have a negative impact on institutions’ ability to facilitate international remittances.
The bureau is also proposing clarifications on a number of issues, including the treatment of U.S. military installations abroad, purpose of transfers in defining rule coverage, permissibility of oral disclosures and error resolution. Comments will be due 30 days after publication in the Federal Register.