CFPB Nonbank Supervision of International Money Transfer Providers - Final Rule
The Consumer Financial Protection Bureau (CFPB or Bureau) issued a final rule on September 12, 2014 that amends its regulations defining "larger participants" of certain markets for consumer financial products and services to add a new section defining the larger participants of the market for international money transfers.
The final rule is substantially similar to the previously proposed rule (please refer to Regulatory Practice Letter 14-05) and defines any nonbank provider of international money transfers that, together with its affiliated companies, conducts at least one million international money transfers annually as a "larger participant" of the market for international money transfers. The nonbank’s number of international money transfers are calculated for the previous calendar year and aggregated with the international money transfers for each of its affiliates, also calculated for the previous calendar year even if the affiliate relationship did not exist for the entire period. Nonbanks meeting the threshold of one million transfers will be subject to the CFPB’s supervisory authority.
The final rule becomes effective December 1, 2014. The CFPB estimates 25 nonbank international money transfer providers, accounting for more than 90 percent of nonbank international money transfers, will meet the transfer threshold.