Regulation E was passed in 1978 but recently has garnered attention in receivables management. Many organizations are finding, to their surprise, they are not Reg E compliant.
Regulation E was created by the Federal Reserve and outlines the rules and procedures for electronic funds transfers (EFTs), as well as rules pertaining to consumer liability for unauthorized card usage. ARM organizations must meet the requirements of Reg E and NACHA when authorizing recurring payments including debit, electronic check or ACH transactions. Additionally, all organizations that accept electronic fund transfers are required to provide the following to the consumer:
- Clear and concise terms and conditions: Outline your financial practices including NSF charges, convenience fees, merchant practices as well as your contact information.
- Right of revocation: Clearly explain how to change, extend or payoff any established payment plan. If changing a payment plan requires an alternate contact, you must include this information as well as hours of operation.
- Online acknowledgement: Include a statement that clearly defines the agreement and give the payer an opportunity to acknowledge understanding and accepting it.
- Signature: The consumer must sign the agreement. Either a hard copy signature or an electronic signature is acceptable. You must store this signed agreement for at least two years.
If you are interested in learning more about Reg E, E-Signatures and NACHA, Billing Tree recently published awhite paper which covers the requirements in depth.
Many receivables organizations have the ability to accept EFT’s but have not completed the requirements for Reg E. RevSpring’s Reg E feature simplifies the legal complexity of providing all this information into your online portal before a consumer makes a payment, allowing your organization to be Reg E compliant and protecting your organization as well as the consumer.
RevSpring’s solution offers dual authentication when the consumer logs onto the payment portal. Your customized Reg E verbiage is displayed on the confirmation page, prior to the consumer finalizing the payment plan. This page also enables the consumer to agree to the terms and conditions and provide an E-Signature to confirm the recurring payment arrangement. Finally, RevSpring’s online portal will store the E-signature for the required two years.
To learn more about RevSpring’s new feature, contact email@example.com or call your RevSpring sales representative.