New rules for international money transfers by U.S. remittance providers generally require full disclosure of the exchange rate and all fees associated with a transfer. If you’re looking for various ‘cheap’ ways to transfer your money overseas, click here to explore 5 options.
The new rules also require remittance transfer providers to investigate disputes and remedy errors. As there can be fees to transfer money overseas, if you are thinking of sending money abroad, it may be best to find out some more information first and then move on to finding alternative routes that don’t have hidden fees attached.
The U.S. Consumer Financial Protection Bureau has set the new requirements under its mandate in the Dodd-Frank financial reform law.
Prior to the reform, international money transfers were mostly excluded from existing consumer protection regulations.
Dodd-Frank expanded the scope of the Electronic Fund Transfer Act to provide protections for senders of remittance transfers, and mandated that rules implementing certain provisions be issued by January 21, 2012.
Remittance transfer providers must disclose the fees, the exchange rate, and amount to be received by the recipient in the destination country.
Disclosures must generally be provided when the consumer first requests a transfer, and again when payment is made. Consumers will generally have 30 minutes after payment is made to cancel a transaction.
“People sending money to their loved ones in another country should not have to worry about hidden fees,” said CFPB Director Richard Cordray. “With these new protections, the idea of international money transfer will be more reliable. Consumers will know the costs ahead of time and be able to compare prices. Transfer providers will also be held accountable for errors that occur in the process.” Being able to find out all this information before going ahead with any transfer is beneficial, as there are a lot of people who send money overseas to relatives in need. So any update will help anyone out who is not too familiar with this concept. If you want to find out more surrounding money transfer, why not take a look at the CFPB’s Rule and Notice of Proposed Rulemaking.