Q: Is the credit union considered a “remittance transfer provider” when a member uses his debit card to purchase goods from a merchant located in another country?
A: No. Payment card networks and card issuers are not “directly engaged with the sender to send an electronic transfer of funds to the foreign merchant” when they provide payment processing or settlement services to the merchant. They’re not remittance transfer providers because they’re providing these services on behalf of the merchant, not the consumer-sender. [CFPB Official Staff Commentary to Regulation E, Comment 1005.30(e)-2(ii)]
Q: Are electronic bill payments considered remittance transfers under Regulation E?
A: It depends. Reg E’s definition of “remittance transfer” is quite broad and will cover electronic bill payments scheduled in advance if: 1) a member uses online bill-pay to make a payment to a designated recipient in another country; and 2) the payment will be made via an electronic fund transfer under the terms of the bill-pay agreement. The payment won’t be considered a remittance transfer if the agreement states that these payments will be made solely by check, draft, or similar instrument.