CFPB Seeks Public Comment on Consumer Protections Regarding Emerging Payments

The Consumer Financial Protection Bureau (CFPB) is seeking public comment on how existing laws apply to emerging consumer payment mechanisms offered through tech companies and video gaming platforms as well as to stablecoins and other digital currencies.

“When people pay for their family expenses using new forms of digital payments, they must be confident that their transactions are not tainted by harmful surveillance or errors,” CFPB Director Rohit Chopra said in a Friday (Jan. 10) press release. “The CFPB is seeking public input on how to apply longstanding consumer and privacy protections to new and emerging payment mechanisms.”

One notice for public comment published by the CFPB requests information about how companies that offer consumer financial products or services manage consumers’ personal financial data, according to the release.

The regulator aims to learn about the effectiveness of existing regulations — covering things like privacy notices and opt-out mechanisms — as well as ways to strengthen that framework and the types of data the public believes the CFPB should monitor, the release said.

The CFPB said in April that it is monitoring video games and virtual worlds to ensure their compliance with federal consumer financial protection laws. The agency said it is doing so because a growing number of these platforms are adding banking options and payments and the CFPB is receiving more complaints from consumers.

In another notice for public comment issued Friday, the CFPB is seeking input on its proposed interpretive rule covering how the Electronic Fund Transfer Act (EFTA) and Regulation E would apply to new and emerging digital payment mechanisms, per the release.

The EFTA provides consumers with protections like the right to dispute erroneous or fraudulent transactions, and the proposed rule is designed to ensure that consumers can invoke those rights and to help market participants develop those payment mechanisms, the release said.

“In addition to today’s issuances, the CFPB is taking other steps to address emerging data privacy challenges,” the release said. “The CFPB also wants to ensure that traditional banks and credit unions are not put at a competitive disadvantage when new market entrants seek to circumvent federal law.”