On Tuesday, the American Bankers Association and several other trade organization submitted a joint letter urging the CFPB to postpone the effective date of its rules on remittance transfers mandated under Dodd-Frank.
The CFPB issued a proposed rule late last month that would revise some aspects of the final rule, including a temporary delay of the final rule’s effective date to 90 days after the finalization of the rule.
“We believe that the Temporary Delay is essential while the bureau considers potential amendments to the Final Rule,” the ABA, Clearing House Association, Consumer Bankers Association, The Financial Services Roundtable, Independent Community Bankers of America, NACHA—The Electronic Payments Association, and the National Association of Federal Credit Unions said in the letter. “The changes that remittance transfer providers must make to their systems and processes in order to comply with the rule are complex and time intensive…Accordingly, the Associations support the Temporary Delay.”
The groups also said in the letter that the CFPB should allow adequate time for the industry to make an orderly transition.
“Although we are still in conversations with our member institutions regarding the impact of the December Proposed Rule, we have heard concerns that, depending on the requirements of the final rule, the proposed 90 day period may not be sufficient to allow remittance transfer providers to develop, implement and test changes in accordance with their compliance and risk management programs,” the groups said.
Fred Becker, the president and CEO of NAFCU, sent a similar letter to the CFPB on Monday urging the agency to delay the rule’s implementation, saying that while NAFCU supports the rule’s delay, it “does not believe this proposed change will constructively or completely solve the problems associated with the remittance transfer rule.”
Under the CFPB’s remittance transfer rule, providers are required to provide customers with pre-payment disclosures related to the exchange rate, fees and taxes associated with a money transfer.