The Consumer Financial Protection Bureau (CFPB) on December 3 issues a proposed remittance rule that will provide regulatory relief to certain banks and credit unions.
The CFPB proposed a change to permanently allow depository institutions to estimate certain fees and exchange rates when making disclosures to their customers. Institutions are currently allowed to do so under a temporary provision of the rule, which is set to expire in July 2020.
In addition, the proposed rule would increase the threshold at which institutions are considered to be “remittance transfer providers” from 100 to 500. The CFPB noted that increasing this safe harbor threshold would reduce the regulatory burden on more than 400 banks and almost 250 credit unions that send a relatively small number of remittances each year.
According to CFPB analysis, all credit unions and a majority of the banks affected by the change in the safe harbor threshold have less than $10 billion in assets.
Read proposed rule.
Showing posts with label Remittance. Show all posts
Showing posts with label Remittance. Show all posts
Thursday, December 5, 2019
Thursday, November 8, 2018
Report Provides Snapshot of CU Remittance Transfers
Credit unions are a small share of the remittance transfer market, according to a recent report by the Bureau of Consumer Financial Protection (Bureau).
The report found that credit unions in 2017 conducted 0.2 percent of remittance transfers and 2.8 percent of the dollar volume based on the average dollar value of remittance transfers by credit unions in the industry survey. Credit unions reported 762,609 remittance transfers in 2017.
The Bureau found that 1,444 credit unions in 2017 offer remittance transfers, up from 863 credit union in 2009.
The number of credit unions that transferred more than 100 remittances in 2017 was 330. In 2014, only 280 credit unions transferred more than 100 remittances, which was down from 372 credit union in 2013. Credit unions that make more than 100 remittance transfers per year are subject to the Bureau's Remittance Rule.
Credit unions that offer and transfer more than 100 remittances are typically larger than credit unions that offer but transfer 100 or fewer remittances. In every year, the median asset size of credit unions that offered and transferred more than 100 remittances exceeded $125 million versus under $20 million for credit unions that offered, but did not transfer 100 remittances.
In 2017, the top 10 credit unions transferred 63 percent of all remittances by credit unions and credit unions that transferred more than 2,000 remittances accounted for 78 percent of all credit union transfers.
Read the report.
The report found that credit unions in 2017 conducted 0.2 percent of remittance transfers and 2.8 percent of the dollar volume based on the average dollar value of remittance transfers by credit unions in the industry survey. Credit unions reported 762,609 remittance transfers in 2017.
The Bureau found that 1,444 credit unions in 2017 offer remittance transfers, up from 863 credit union in 2009.
The number of credit unions that transferred more than 100 remittances in 2017 was 330. In 2014, only 280 credit unions transferred more than 100 remittances, which was down from 372 credit union in 2013. Credit unions that make more than 100 remittance transfers per year are subject to the Bureau's Remittance Rule.
Credit unions that offer and transfer more than 100 remittances are typically larger than credit unions that offer but transfer 100 or fewer remittances. In every year, the median asset size of credit unions that offered and transferred more than 100 remittances exceeded $125 million versus under $20 million for credit unions that offered, but did not transfer 100 remittances.
In 2017, the top 10 credit unions transferred 63 percent of all remittances by credit unions and credit unions that transferred more than 2,000 remittances accounted for 78 percent of all credit union transfers.
Read the report.
Tuesday, November 19, 2013
Texas Trust CU Says Adios to International Remittance Business
Texas Trust Credit Union (Mansfield, Texas) is a casualty of the Consumer Financial Protection Bureau's new international remittance rule.
The credit union announced on its website that it can no longer offer international wire transfers, due to recent regulatory changes.
The credit union's September call report stated that the credit union had originated 146 international remittances through the first nine months of 2013.
See the announcement.
The credit union announced on its website that it can no longer offer international wire transfers, due to recent regulatory changes.
The credit union's September call report stated that the credit union had originated 146 international remittances through the first nine months of 2013.
See the announcement.
Monday, October 28, 2013
International Remittances
The Dodd-Frank Act expanded the scope of the Electronic Fund Transfer Act to provide protections for senders of international remittance transfers.
On October 28, 2013, the Consumer Financial Protection Bureau's (CFPB) regulation governing international remittances goes into effect. The rule applies to banks, credit unions, and money transmitters that offer international transfers to consumers. However, it does not apply to companies that consistently provide 100 or fewer remittance transfers each year, nor does it apply to transactions under $15.
As of June 2013, there were 1,290 credit unions that originated at least one international remittance during the first six months of 2013. Half of these 1,290 credit unions originated 17 or less international remittances during the first half of 2013.
There are 374 credit unions that as of mid-year are on the pace of originating more than 100 international remittances this year and thus would be subject to the CFPB's regulation.
The average asset size of a credit union that would be subject to the CFPB remittance rule is $1.4 billion. However, half of the credit unions have less than $743 million in assets. Thirty-six credit unions have less than $100 million in assets.
The table below list the 25 credit unions that reported the most international remittances originated year-to-date, as of June 2013. (Click on image to enlarge) Three credit unions originated more than 1 million international remittances -- America First (UT), First Entertainment (CA), and CFCU Community (NY).
On October 28, 2013, the Consumer Financial Protection Bureau's (CFPB) regulation governing international remittances goes into effect. The rule applies to banks, credit unions, and money transmitters that offer international transfers to consumers. However, it does not apply to companies that consistently provide 100 or fewer remittance transfers each year, nor does it apply to transactions under $15.
As of June 2013, there were 1,290 credit unions that originated at least one international remittance during the first six months of 2013. Half of these 1,290 credit unions originated 17 or less international remittances during the first half of 2013.
There are 374 credit unions that as of mid-year are on the pace of originating more than 100 international remittances this year and thus would be subject to the CFPB's regulation.
The average asset size of a credit union that would be subject to the CFPB remittance rule is $1.4 billion. However, half of the credit unions have less than $743 million in assets. Thirty-six credit unions have less than $100 million in assets.
The table below list the 25 credit unions that reported the most international remittances originated year-to-date, as of June 2013. (Click on image to enlarge) Three credit unions originated more than 1 million international remittances -- America First (UT), First Entertainment (CA), and CFCU Community (NY).
Wednesday, August 1, 2012
Delay CFPB's Remittance Rule
ABA and four other bank and credit-union trade groups this week urged all House members to sign Reps. Blaine Luetkemeyer (R-Mo.) and Yvette Clarke’s (D-N.Y.) letter urging Consumer Financial Protection Bureau (CFPB) Director Richard Cordray to delay until February 2015 the bureau’s final rule on remittance transfers.
The rule was “intended to provide greater transparency and certainty, smoother error resolution procedures, and increased access to low-cost transfer services for consumers who utilize remittances and international wire transfer services,” the trade groups said in a letter to House members.
Instead, it would “add dramatically to the costs of providing these services, and create mandates that are simply not possible for community-based institutions to implement,” they said. “The end result is likely to be fewer and more costly choices for consumers as credit unions and community banks stop offering these services. This is clearly not what Congress intended.”
The trade groups emphasized that it’s vital for community banks and credit unions, which often operate in rural and underserved areas, to be able to offer such services to the millions of consumers that send billions of dollars to their families in other countries.
“While we strongly support … appropriate consumer disclosures of fees and product terms, the rule … will make it exceedingly difficult and costly for our member financial institutions to continue offering these services,” they said. “If not delayed, and hopefully modified, the CFPB’s remittance rule will result in fewer choices and more costs for consumers.”
Read the trade groups’ and Luetkemeyer-Clarke letters.
The rule was “intended to provide greater transparency and certainty, smoother error resolution procedures, and increased access to low-cost transfer services for consumers who utilize remittances and international wire transfer services,” the trade groups said in a letter to House members.
Instead, it would “add dramatically to the costs of providing these services, and create mandates that are simply not possible for community-based institutions to implement,” they said. “The end result is likely to be fewer and more costly choices for consumers as credit unions and community banks stop offering these services. This is clearly not what Congress intended.”
The trade groups emphasized that it’s vital for community banks and credit unions, which often operate in rural and underserved areas, to be able to offer such services to the millions of consumers that send billions of dollars to their families in other countries.
“While we strongly support … appropriate consumer disclosures of fees and product terms, the rule … will make it exceedingly difficult and costly for our member financial institutions to continue offering these services,” they said. “If not delayed, and hopefully modified, the CFPB’s remittance rule will result in fewer choices and more costs for consumers.”
Read the trade groups’ and Luetkemeyer-Clarke letters.
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