21 October 2014

Dodd-Frank cross-border payment rules to be major compliance challenge, say banks

29 January 2013  |  6753 views  |  1 Washington capitol hill

US banks think that new regulations on cross-border transfers will hit the payments business hard without benefiting consumers, according to a poll from vendor Fundtech.

Dodd-Frank section 1073 mandates transparency around costs, timing and repudiation for consumer cross-border transfers.

However, a survey of banks shows that nearly 90% expect the rule will have a negative impact on their payments businesses.

When asked whether the regulation will deliver the intended benefit to the consumer, 52% say it would have more of a negative impact than a positive one. Only two per cent of respondents felt that the regulation would deliver the intended benefits.

Dodd-Frank 1073 mandates that consumers are given 30 minutes to cancel cross-border transactions yet only two per cent of banks state that consumers rescinding orders is a frequent occurrence. Of those that know the frequency, 43% say consumers never rescind orders.

Tony Salamone, SVP, US banking product management, Fundtech, says: "Our recent survey validates what we have been hearing from our clients - Dodd-Frank 1073 will be a major compliance challenge in 2013."

Comments: (1)

Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 31 January, 2013, 12:24

This is a classical case of getting the desired answer by asking the wrong audience. If Fundtech was really serious about finding out whether the new rules would benefit consumers, it should've surveyed consumers instead of banks. Interestingly, if "43% say consumers never rescind orders", it means that 57% do! To me, that sounds like a large enough majority of consumers who should find the new rules beneficial.

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