Most banks are pessimistic about the likely impact of section 1073 of the Dodd-Frank Act, expecting it to provide little benefit for consumers but with far-reaching negative effects for the payments business, according to a Fundtech survey. The declared aim of 1073 is to provide consumers with transparency into the timeliness and cost of making remittance transfers.
However, a survey of banks carried out last month by the banking software group found that 90% believed that the impact on their payments business would be somewhat negative or extremely negative. Less than 5% were optimistic that 1073 would be beneficial. Asked whether consumers would benefit from 1073, 52% of respondents said that the impact would on balance be negative and only 2% expected the regulation to deliver the intended benefits.
Dodd-Frank 1073 mandates that consumers are given 30 minutes to cancel cross-border transactions, although only 2% of banks state that consumers rescinding orders is a frequent occurrence. Of those banks that knew the frequency, 43% stated that consumers never rescind orders.