WASHINGTON (UPDATED 8/7/12 4:05 p.m. ET )--The Consumer Financial Protection Bureau (CFPB) just released its long-anticipated rule implementing provisions under the Dodd-Frank Wall Street Reform and Consumer Protection Act that require remittance transfer providers to disclose fees upfront, as well as the exchange rate and the amount to be received by the recipient.
The Credit Union National Association (CUNA) had warned the bureau that its remittance transfer rule, as proposed, would impose unsustainably high compliance costs and legal liabilities that could force credit unions with relatively small volume international payments programs to eliminate such programs.
CUNA had urged the bureau to increase its proposed safe harbor exemption for small remittance issuers up from 25 remittances per year to no less than 1,000 remittances a year.
Although the CFPB did increase the safe harbor exemption in the final rule, it extended it only to providers that transact 100 or fewer remittances per year.
The bureau's final remittance rule will take effect Feb. 7, 2013.
Disclosures must generally be provided when the consumer first requests a transfer and again when payment is made. The rule also provides consumers with error resolution and cancellation rights.
This final rule is only on the safe harbor and preauthorized transfers. It affects international wires and international ACH transfers.
Watch tomorrow's News Now for more detail.