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Requiring Bank to Disclose a Fee from a 3rd Party

Answered by: 
John Burnett

Question: 
Reg. E- VISA recently revised their current exchange rate disclosure and notified banks that it is replacing the currency conversion fee with an International Service Assessment of 1%. The letter we received said we must notify our debit card holders of this change by April 1. Does Reg. E require us to provide the 21 day notice in this instance where the fee is assessed by a 3rd party such as VISA. In the past this fee was assessed directly to the customers account but now we have the choice of absorbing the fee or passing it on.
Answer: 

If the change is transparent to your customer -- that is, if you will continue assessing a fee that was being assessed before (and correctly disclosed it) -- I see no need for advance disclosure. But if the fee will be assessed so that it appears differently, or if it was not disclosed correctly before, I recommend making the 21-day change in terms disclosure.

First published on BankersOnline.com 4/10/06

First published on 04/10/2006

Filed under: 
Technology
Filed under technology as: 
Currency
IT

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