Answer:
Reg E Section 1005.7 requires that EFT disclosures be made before a customer contracts for an electronic funds transfer service. The service itself is not changing as you are still providing a debit card, so this disclosure is not triggered.
Reg E Section 1005.8 requires that you notify customers if the change results in (i) Increased fees for the consumer; (ii) Increased liability for the consumer; (iii) Fewer types of available electronic fund transfers; or (iv) Stricter limitations on the frequency or dollar amount of transfers. None of these would apply unless you are changing your daily purchase limits on the new card.
Although EFT disclosures are not required, you will need to provide a new debit card agreement to all existing cardholders that includes MasterCard verbiage regarding Zero Liability, cross border fees, etc. Many forms vendors combine the EFT disclosure with the VISA/MasterCard information into the same terms and conditions document. It is probably easier to redisclose with your new cardholder agreement than to try to separate the required MasterCard disclosures from the Reg E disclosures.
First published on BankersOnline.com 7/2/12
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