- Source: consumerfinance.gov
On May 11, 2020 the Consumer Financial Protection Bureau (Bureau) issued a final rule amending the Remittance Transfer Rule. Reading the amendments brought back many memories of implementing this pesky rule back in 2013. This is a great time to assess your overall compliance with the Remittance Transfer Rule under Regulation E. Treliant has subject matter expertise in this area to assist.
The final rule amendments are effective July 21, 2020. The key amendments:
- Permit depository institutions to continue to provide estimates of the exchange rate and fees under certain conditions.
- The Rule takes effect the day the provision was set to expire; and, may preserve consumers’ ability to send remittances from their accounts to certain countries or recipient institutions.
- Increase threshold to determine whether an entity makes remittance transfers in the normal course of business from 100 to 500 remittance transfers annually.
- The safe harbor applies to entities making 500 or fewer transfers annually in the current and prior calendar years. According to the Bureau, this will reduce the burden on over 400 banks and almost 250 credit unions that send a relatively small number of remittances—less than .06 percent of all remittances.
On April 10, 2020, the Bureau announced regulatory flexibility as a result of the impact the pandemic is having on consumers’ finances, both in the United States and around the world. Many consumers rely on remittance transfer providers to send money from the United States to their families and friends abroad. These amendments to the Remittance Transfer Rules will help minimize the impact of the pandemic on the remittances market by enabling insured institutions to continue to focus on the needs of their customers.
While these are welcomed amendments it is also a good reminder to assess your institutions overall compliance with Remittance Transfer Rules.