Topic: Credit Card Network Rules
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What language should we use when notifying customer about the new MasterCard zero liability rules for PIN based transactions that are going into effect on October 17, 2014?
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We believe that your institution should provide change in terms notices to any customers who will be affected by the MasterCard rule change. Because the MasterCard rule change could increase a customer’s liability for unauthorized transactions, the change must be disclosed. Regulation E requires a change in terms notice at least 21 days before the…
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Can we take loan payments by credit card? We accept MasterCard and Visa.
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The answer to your question depends on the MasterCard and Visa rules and your institution’s agreements with MasterCard and Visa. We have reviewed the MasterCard and Visa rules, which are described below. But we note that these rules are frequently revised, so it may be best to check with Visa and MasterCard directly to see…
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We’re switching our debit cards to a new network, which has different customer liability provisions than our existing network; otherwise the card terms and conditions are unchanged. Do we need to provide a change in terms notice, or do we need to take on the expense of mailing entirely new Regulation E notices?
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We are not aware of any requirement to send existing customers a new set of initial disclosures under Regulation E (provided that those customers have already received initial disclosures). Regulation E requires initial disclosures only “at the time a consumer contracts for an electronic fund transfer service or before the first electronic fund transfer is…
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Can we charge a fee for credit card cash advances? The VISA rules state that we cannot add a surcharge to manual cash disbursements, “unless local law expressly requires that a Member be permitted to impose a surcharge.”
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We are not aware of any Illinois law that “expressly requires that a Member be permitted to impose a surcharge” on cash transactions, as required by the VISA rule cited in your question. As we discussed , the Illinois Banking Act does allow banks to charge any fee agreed to by a customer, but it…
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Can we charge cancellation and lost/stolen card fees on our general use, open loop, non-reloadable gift cards? If so, can we waive the fees? And, are we required to refund customers who cancel their gift cards?
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Lost/stolen card and cancellation fees We do not believe that Regulation E or Illinois law would prohibit a bank from charging fees for lost or stolen cards or for card cancellations, provided that such fees are disclosed in the card agreement. As a general rule, Regulation E restricts banks from charging three types of fees:…
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Are you aware of any regulation on charging fees to non-customers for credit card cash advances?
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We do not believe that any Illinois or federal laws or regulations would prohibit you from charging a fee or refusing to give cash advances to non-customers. Therefore, the issue does depend on your agreement with MasterCard or VISA. The rules can be found in Chapter 8.9 of the MasterCard rules (“Cash Disbursements”). Assuming that…
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We have non-customers who are bringing in H&R Block cash advance cards, which they want to exchange for cash. Can we charge a cash advance fee?
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We do not believe that any Illinois or federal laws or regulations would prohibit you from charging a fee to non-customers for cash advances. Therefore, the issue does depend on your agreement with MasterCard. The rules can be found in Chapter 8.9 of the MasterCard rules (“Cash Disbursements”). Assuming that these are the rules that…