ARLINGTON, Va. – A proposal to reform remittance practices could force credit unions to terminate their international electronic transfer programs, pushing members to seek these same services at more expensive non-traditional providers, NAFCU said.
In a letter to Senate Banking Committee Chairman Christopher Dodd (D-CT) and Committee Ranking Member Richard Shelby (R-LA), the trade group said it is concerned that the section of the Restoring American Financial Stability Act dealing with remittances would impose a number of new burdens on CUs that provide international electronic transfer of funds services.
“NAFCU is concerned that the overly broad definition of a ‘remittance’ would affect all international electronic transfers of funds, including those that are not in fact transfers of money from immigrants in the United States back to their families in other countries,” the association said. “As such, the language…would create significant additional burdens on any credit union that offers international wire transfer services to its members, by imposing several new regulatory and disclosure requirements. If enacted, these requirements could ultimately force credit unions to terminate their international electronic transfer programs, and oblige their members to seek these same services at more costly non-traditional financial institutions.”
NAFCU suggested narrowing the scope of the definition of a “remittance” to exclude those international electronic fund transfer services that are not conventional money transmissions.
