§5601 — Title 12 Banks and Banking | U.S. Code

Summary

The Board of Governors must work with the Federal Reserve banks and the Department of the Treasury to expand use of the automated clearinghouse (ACH) and other payment methods for sending remittances abroad. They must focus on countries that get a lot of U.S. remittances, judging this by how many transfers there are, how big they are, how important those transfers are to the receiving country’s overall money flows (including U.S. government payments to people living abroad), whether expansion is practical, and whether the Federal Reserve can set up payment gateways in different regions and currency areas to route payments. Within one year after July 21, 2010, and then every two years on April 30 for ten years starting July 21, 2010, the Board must report to the Senate Banking Committee and the House Financial Services Committee on ACH progress, including adoption of International ACH Transactions rules and format and recommendations to increase adoption. Each federal banking agency and the National Credit Union Administration must give guidance to the banks and credit unions they supervise about offering low-cost remittance services and low- or no-cost basic consumer accounts, and about agency services for remittance providers. The Bureau, the federal banking agencies, and the NCUA must help the Financial Literacy and Education Commission carry out the SAFE Strategy for remittances. Within 365 days after July 21, 2010, the Director must report to the President and the same congressional committees on whether remittance history can help a consumer’s credit score, what legal or business limits exist, and how to make exchange-rate and recipient-amount disclosures as clear as possible, including telling the sender the actual exchange rate used and the amount the recipient received.

Title 12, §5601

Banks and Banking — Source: USLM XML via OLRC

(a)

(b)(1)The Board of Governors shall work with the Federal reserve banks and the Department of the Treasury to expand the use of the automated clearinghouse system and other payment mechanisms for remittance transfers to foreign countries, with a focus on countries that receive significant remittance transfers from the United States, based on—

(A)the number, volume, and size of such transfers;

(B)the significance of the volume of such transfers relative to the external financial flows of the receiving country, including—

(i)the total amount transferred; and

(ii)the total volume of payments made by United States Government agencies to beneficiaries and retirees living abroad;

(C)the feasibility of such an expansion; and

(D)the ability of the Federal Reserve System to establish payment gateways in different geographic regions and currency zones to receive remittance transfers and route them through the payments systems in the destination countries.

(2)Not later than one calendar year after July 21, 2010, and on April 30 biennially thereafter during the 10-year period beginning on July 21, 2010, the Board of Governors shall submit a report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the status of the automated clearinghouse system and its progress in complying with the requirements of this subsection. The report shall include an analysis of adoption rates of International ACH Transactions rules and formats, the efficacy of increasing adoption rates, and potential recommendations to increase adoption.

(c)(1)Each of the Federal banking agencies and the National Credit Union Administration shall provide guidelines to financial institutions under the jurisdiction of the agency regarding the offering of low-cost remittance transfers and no-cost or low-cost basic consumer accounts, as well as agency services to remittance transfer providers.

(2)As part of its 22 So in original. Probably should be “their”. duties as members of the Financial Literacy and Education Commission, the Bureau, the Federal banking agencies, and the National Credit Union Administration shall assist the Financial Literacy and Education Commission in executing the Strategy for Assuring Financial Empowerment (or the “SAFE Strategy”), as it relates to remittances.

(d)

(e)Before the end of the 365-day period beginning on July 21, 2010, the Director shall submit a report to the President, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives regarding—

(1)the manner in which the remittance history of a consumer could be used to enhance the credit score of the consumer;

(2)the current legal and business model barriers and impediments that impede the use of the remittance history of the consumer to enhance the credit score of the consumer; and

(3)recommendations on the manner in which maximum transparency and disclosure to consumers of exchange rates for remittance transfers subject to this title 33 See References in Text note below. and the amendments made by this title 3 may be accomplished, whether or not such exchange rates are known at the time of origination or payment by the consumer for the remittance transfer, including disclosure to the sender of the actual exchange rate used and the amount of currency that the recipient of the remittance transfer received, using the values of the currency into which the funds were exchanged, as contained in section 1693o–1(a)(2)(D) 3 and 1693o–1(a)(3) of title 15 (as amended by this section).

Notes & Related Subsidiaries

Editorial Notes

References in Text

This title, where footnoted in subsec. (e)(3), is title X of Pub. L. 111–203, July 21, 2010, 124 Stat. 1955, known as the Consumer Financial Protection Act of 2010, which enacted this subchapter and enacted, amended, and repealed numerous other sections and notes in the Code. For complete classification of title X to the Code, see

Short Title

note set out under section 5301 of this title and Tables. section 1693o–1(a)(2) of title 15, referred to in subsec. (e)(3), does not contain a subpar. (D). Codification Section is comprised of section 1073 of Pub. L. 111–203. Subsecs. (a) and (d) of section 1073 of Pub. L. 111–203 enacted section 1693o–1 of Title 15, Commerce and Trade, amended section 1757 of this title and section 1693, 1693b, 1693p, 1693q, and 1693r of Title 15, and amended provisions set out as a note under section 1693 of Title 15.

Statutory Notes and Related Subsidiaries

Effective Date

Part effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as a note under section 5301 of this title.

§5601 Remittance Transfers