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Posted: Jul 18, 2018
Categories: Regulations
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ThePaymentsReview continues a new feature that highlights regulatory topics important to credit unions.

When one thinks of ADA accessibility, sidewalk ramps, disabled parking spaces, and wheel chair access immediately comes to mind. What about websites?

The Americans with Disabilities Act (ADA) sets standards for accessibility for people with disabilities to all commercial and public entities that have “places of public accommodation”. In 2010, the Department of Justice clarified that the definition of places of public accommodation includes the internet, and hence, websites of commercial and public entities.

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Posted: Jun 22, 2018
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Credit Unions Can Offer Members Affluent Cards and Increase Their Bottom Line

Wealthy Americans love credit card rewards. These cardholders can also be the most profitable for a credit union issuer – but only with the right card product.

The battle to acquire cardholders is being won by issuers who use rewards as ammunition. Both Visa and Mastercard report card growth in the low double digits, with the lion’s share of that coming from reward cards. It’s no secret that Americans love their reward cards. According to Brian Riley of The Payments Journal, more households have credit card rewards than have 401k plans. And the rewards continue to grow. In 2008, the average credit card bonus offer was 16,050 points. Today, the average offer is 40,556 points.

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Posted: Apr 11, 2018
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ThePaymentsReview continues a new feature that occasionally highlights regulatory topics important to credit unions.

Back on July 11, 2016 the Financial Crimes Enforcement Network (FinCEN) issued a rule requiring covered financial institutions to identify and verify the identity of any beneficial owner. The new Customer Due Diligence (CDD) rule takes effect May 11, 2018 at which time the financial institution must be compliant. For purposes of the CDD Rule, covered financial institutions are federally regulated banks and federally insured credit unions, mutual funds, brokers or dealers in securities, futures commission merchants, and introducing brokers in commodities.

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Posted: Mar 19, 2018
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Faster payments mean a vendor getting paid by its customer quicker, or getting a P2P transfer into the recipient’s bank account the same day. Automated Clearinghouse (ACH), the network that connects every financial institution, and makes payroll deposits, bill pay and business settlements possible, has been undergoing changes in phases. The phases represent incremental steps in the process to shorten the length of time it takes to make payments, from days to hours. The third phase of this transition went into effect March 16, 2018, and credit unions and their members, especially business owners, need to be aware of the impact. 

 

 

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Posted: Mar 6, 2018
Categories: Regulations, Consulting
Comments: 0

ThePaymentsReview continues a new feature that occasionally highlights regulatory topics important to credit unions.

Accounting for loan losses is at the heart of credit union accounting. Setting aside reserves for loan losses is an important accounting component, but an increase in allowances reduces a credit union’s capital. Under current accounting standards, a credit union recognizes losses when they reach a probable threshold of loss. This is called an incurred loss accounting model. In practical terms, incurred loss accounting is a backwards-looking model, measuring a pool of loans against historic annualized write-offs. This method can drastically underrepresent potential future losses when a loan portfolio is exposed to a financial crisis, especially after a run of several years with lower losses. And this is exactly what happened following the financial crisis of 2008 in which some credit unions found themselves under reserved and unprepared for losses in their loan and mortgage portfolios while losses to their investments, and in many cases, shares declined. In the rising economy of the early 2000’s, losses were not being accounted for as “probable”.

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