WASHINGTON–In a letter sent to CEOs at several credit unions, banks and other financial services companies, outgoing CFPB Director Richard Cordray called for quick adoption of technologies that allow consumers to exert “much greater control” over their plastic cards and other payment methods.
In the letter, Cordray, who is exiting the agency at the end of November, said he was seeking to “bring to your attention things we believe you may want to consider prioritizing to serve your customers better.” Among those things, he said, is a desire to see “broader adoption of the Open Credit Score Initiative—a win-win approach that involves sharing your customers’ credit scores with them on a regular basis, to boost awareness and encourage them to find ways to improve their credit scores, which may lead to them becoming stronger customers and result in lower charge-offs for you. Our sense is that many institutions have found merit and advantage in both of these suggestions.”
The most “timely” move many financial institutions could make now to benefit consumers, wrote Cordray, is “new technology that makes it feasible, right now, to enable consumers to exert much greater control over their credit cards, debit cards, and other payment methods.
“Digital servicing platforms offer the potential for enhanced security and the peace of mind that are made possible by establishing controls that will make it more difficult for unauthorized transactions to occur,” Cordray wrote. “Moreover, such platforms can allow consumers to exert greater control on their own spending and those they authorize to use their accounts by establishing settings that limit how, where, when, and to what extent their accounts are accessed—and to do so much more easily and conveniently. I believe your customers will want and demand this capability, and it is worth considering how you can prioritize the steps necessary to speed its availability to them.”
After outlining several other points, Cordray concluded by saying, “I urge you to think creatively about how you can put more control directly in the hands of your customers.
The complete text of the letter can be found here: https://www.consumerfinance.gov/about-us/blog/cfpb-sends-letters-financial-institution-ceos-encouraging-more-consumer-control-over-payment-methods/