Cordray to CUAC: Transparency, security, access key to better payments

October 9, 2015

WASHINGTON (10/9/15)--The payments system can improve in the areas of transparency, security and access, according to Consumer Financial Protection Bureau (CFPB) Director Richard Cordray. Speaking Thursday to the Credit Union Advisory Council (CUAC), Cordray also expressed appreciation for credit unions’ role in the economy.

“The Consumer Bureau is well aware that credit unions were not one of the causes of the financial crisis. You were not underwriting the bad loans that brought down the housing market,” Cordray said. “Instead, you were sounding the alarm bells well before the sinking of the economy.”

Cordray went on to say that payments systems have room to improve to ensure payers, payees, providers, institutions and operators can participate in the system without more consistency and predictability.

His recommendations include:

  • Transparency, particularly when it comes to consumers knowing when deposited funds will become available;
  • Security, meaning consumers should not be exposed to repeated attempts to collect payments, nor should they be victimized by unauthorized payments; and
  • Access to electronic payment systems from the un- and underbanked. Consumers should have access to accounts that permit electronic payments in order to have federal protections in place, Cordray said.

 The CFPB recently announced eight new CUAC members, six of whom are CUNA members. Thursday’s meeting was the first for those new members, who generally serve two years, but terms can be modified by the CFPB director.