We released our plan to assess the effectiveness of the remittance rule today. We ask the public to comment on our plan, suggest sources of data, and generally to provide information that would help with the assessment.
Consumers in the United States send billions of dollars to foreign countries each year. These international money transfers are known as remittances. Prior to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), federal consumer protection rules did not apply to most remittances. In the Dodd-Frank Act, Congress established new standards for remittance transfers and authorized the CFPB to issue rules that would make these standards clear and effective. We refer to all of the requirements that took effect on October 28, 2013 as the remittance rule.
The remittance rule gave consumers strong new protections. It requires companies to give accurate disclosures to consumers before they pay for a remittance transfer. The remittance rule also requires remittance transfer providers to investigate disputes and remedy certain errors. For example, if a consumer’s money does not arrive as promised, then that consumer can generally get a refund or have the transfer sent again free of charge. An important objective of the remittance rule is to provide consumers with better information for comparison shopping and to generally improve the predictability of remittance transfers for consumers.
In addition to authorizing the CFPB to write rules for remittances, the Dodd-Frank Act requires us to review some of our rules within five years after they take effect. These formal reviews are called assessments. We are conducting an assessment of the remittance rule, and we will issue a report of the assessment in the fall of 2018. As required by law, the assessment will address the rule’s effectiveness in meeting the purposes and objectives of Title X of the Dodd-Frank Act and the specific goals of the remittance rule, using available evidence and data.
We see conducting the assessment as an opportunity. Conducting the assessment will advance our knowledge of the benefits and costs of the key requirements of the remittance rule. The assessment will also provide the public information on the remittance market, and help us to fulfill our commitment to be an evidence-based and effective agency.
We would like your help in improving the assessment. We invite consumers, consumer advocates, remittance providers, industry representatives, and other interested parties to comment on our assessment plan, suggest sources of data, offer other recommendations, and generally provide information that would help us with this work.
The Consumer Bureau is committed to well-tailored and effective regulations and has sought to carefully calibrate its efforts to ensure consistency with respect to consumer financial protections across the financial services marketplace.
Comments on the plan will be due 60 days after it is published in the Federal Register.
For more information on how to comply with the remittance rule, view our implementation and guidance page.