WASHINGTON—The CFPB’s prepaid accounts rule should be rescinded entirely or, at the very least, should not apply to credit unions, according to NAFCU.
In June, the CFPB issued a proposal that would adjust the final rule's requirements for resolving errors on unregistered accounts and provide greater flexibility for credit cards linked to digital wallets. In a comment letter to the Bureau, NAFCU Regulatory Affairs Counsel Andrew Morris said that while NAFCU supports the CFPB’s efforts to identify amendments aimed at alleviating regulatory burden, this rule still shouldn't apply to credit unions.
He added that because these amendments will take time to implement, the effective date of the final rule should be delayed one year to April 1, 2019.
Morris reiterated that the CFPB should rescind the rule entirely "to avoid the risk of disrupted service or loss of access to affordable prepaid products." He noted that "The transition to new disclosures, new systems, and potentially new service agreements will correspond with significant costs and reduced availability of prepaid products."
Morris detailed the CFPB's proposed amendments and offered additional suggestions for further reducing the regulatory burden this rule places on the credit union industry.