ICBA urges CFPB to reduce remittance rule burden

ICBA called on the Consumer Financial Protection Bureau to reduce the regulatory burden of its rule on remittance transfers to avoid disadvantaging community bank customers.

ICBA Comments: In a comment letter on the CFPB’s review of information collected under Electronic Fund Transfer Act (Regulation E), ICBA called on the bureau to:

• Increase the “normal course of business” safe harbor threshold to 1,200 remittances annually and exempt small financial institutions from the rule altogether.

• Reduce the time for filing complaints from 180 days to 60 days to promote regulatory consistency.

• Eliminate the “availability date” that requires community banks to predict when they believe funds would be available in a foreign location.

• Eliminate the 30-minute cancellation requirement because most consumers value transaction speed over reversibility.

Background: Reg E requires accurate disclosure of the costs, terms, and rights relating to electronic fund transfer and remittance transfer services. The compliance burden has led many community banks to exit remittance services.