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Posting Transactions Online in Lieu of Statements?

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We have online banking but do not have online statements. Since customers have access to transactions, images, and balances 24/7/365 can we elect not to send them a paper statement? Isn't posting online a periodic statement? If not, then at cycle time, when we "drop" statements then send them to archive, but do not print them, isn't this the same as having their statement accessible should they request a printed statement?

For open-end credit accounts, Section 226.5(b)(2) of Regulation Z requires you to mail or deliver a periodic statement for each billing cycle at the end of which an account has a debit or credit balance of more than $1 or on which a finance charge has been imposed. Electronic delivery of periodic statements is permitted IF the creditor follows the rules found in Section 226.36.

On the deposit side, Section 205.9(b) of Regulation E requires you to send a periodic statement for each monthly cycle in which an electronic fund transfer has occurred, and at least quarterly if no transfer has occurred. As with Regulation Z, electronic delivery is permitted IF you follow the rules found in Section 205.17 of Regulation E (virtually identical to Section 226.36.)

Section 230.6 of Regulation DD does not require you to provide periodic statements. Nevertheless, if statements are required by your contract, state law, or Regulation E, then written Truth in Savings disclosures must be included in that statement. Section 230.10 of Regulation DD permits electronic delivery in the same manner as Regulations E and Z.

"Posting information online" is NOT equivalent to providing a paper statement unless the posting is part of a comprehensive electronic delivery system that meets the requirements of the applicable electronic delivery regulations cited above. To be a legally acceptable alternative to paper disclosures, electronic delivery systems must be accepted by each affected accountholder. The rules for obtaining this "informed consent" are found in the Federal ESIGN Act.

First published on 07/18/05

First published on 07/18/2005

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