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Remittance proposal: Are threshold adjustments adequate?
NAFCU is seeking feedback from member credit unions on the CFPB's proposal to increase the safe harbor threshold under its remittance rule. Although the proposed threshold is not as high as NAFCU recommended, the association acknowledges the benefits of the exemption for those credit unions that do not originate many remittance transfers.
In a Regulatory Alert, NAFCU highlights that the proposal would:
- increase the safe harbor threshold from its current level of 100 transfers in the previous and current calendar year to 500;
- adopt new thresholds to permit continued use of estimates when disclosing exchange rate or fee information for insured depository institutions, such as credit unions;
- permit estimates of the exchange rate for a remittance transfer to a particular country if, among other things, the designated recipient will receive funds in the country's local currency and the insured institution made 1,000 or fewer remittance transfers in the prior calendar year to that country when the designated recipients received funds in the country's local currency; and
- permit estimates of covered third-party fees for a remittance transfer to a particular designated-recipient's institution if, among other things, the insured institution made 500 or fewer remittance transfers to the designated institution in the prior calendar year.
NAFCU would like to know if credit unions agree with the safe harbor threshold adjustment, and if the adoption of new thresholds to permit continued use of estimates would mitigate the expiration of the temporary exception.
Credit unions can submit comments to NAFCU through its Regulatory Alert until Jan. 6, 2020; comments are due to the CFPB Jan. 21. NAFCU has previously shared with Congress challenges credit unions face as a result of changes in remittance requirements, including increased costs for the institutions and their members.