CFPB Remittance Relief Falls Short: Trades
The CFPB could extend an exception to its remittance rule, but it won’t bring back credit unions that already abandoned the international wire transfer business, according to trade associations.
“CUNA is generally supportive of the CFPB’s proposal to extend the temporary exception that permits certain estimated disclosures under the agency’s international remittance transfer rule,” said Mary Dunn, senior vice president and deputy general counsel.
“Credit unions offer remittances in a number of cases as an accommodation for their members, and estimated disclosures can be helpful for open-network transfers that utilize third-party institutions to reach foreign countries. However, we remain very concerned that credit unions have reduced or eliminated remittances in light of the rule generally, and this proposal will likely not affect that result.”
Dunn said CUNA will keep pressing the CFPB to give credit unions a much higher exemption level under the rule.
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, banks and credit unions are able to estimate third-party fees and exchange rates when providing remittance transfers to their accountholders until July 21, 2015.
If finalized, the CFPB’s proposal would extend the temporary exception by five years until July 21, 2020.
NAFCU also welcomed the proposed extension but expressed ongoing concerns about the rule overall, including increased costs and other regulatory burdens for any credit union facilitating more than 100 remittances annually.
“As it stands, this rule is pushing credit unions out of the market,” said NAFCU Regulatory Affairs Counsel Angela Meyster.