CFPB finalizes prepaid rule updates; moves effective date

Agency Rule-Making & Guidance CFPB Succession CFPB Prepaid Rule Regulation Z

On January 24, the CFPB released updates to the final rule governing prepaid accounts (Rule) delaying the effective date of the rule by one year, to April 1 2019. In December, as previously covered by InfoBytes, the Bureau announced its plan to delay the effective date and adopt final amendments to the Rule. In addition to certain clarifications and other minor adjustments, the updates include: (i) finalizing that the requirement for consumers to register their accounts to receive fraud and error protection benefits will only be applied prospectively, after a consumer’s identity has been verified; and (ii) creating a limited exception to certain provisions of the Rule for instances where traditional credit card accounts, subject to Regulation Z open-end credit rules, are linked to digital wallets.