To: All Credit Union CEOs

From: Matt Beard - Regulatory Specialist

Date: February 7, 2006

RE: Interim Final Rule on Payroll Cards

Note: This new Comment Call format is designed to highlight the key issues associated with the proposed changes, with the option of going to the full description from CUNA. If the topic discussed is of interest, you may click on the link that will take you to the full explanation and questions associated with the changes. If you receive this information via fax or mail, and you do not have Internet access, please contact Angie Hall at 800-262-6285 to receive CUNA’s full proposal


The Federal Reserve Board issued an interim final rule in which payroll card accounts are defined as “accounts” for purposes of coverage under Regulation E. Financial institutions will have flexibility in how to provide certain account transaction information to payroll card users. Instead of providing periodic statements, institutions may instead:

  • Make available to the consumer the account balance through a readily available telephone line;
  • Make available to the consumer an electronic history (such as through an Internet Web site) of the consumer’s account transactions that covers at least 60 days preceding the date the consumer electronically accesses the account; and
  • Provide promptly upon the consumer’s oral or written request, a written history of the consumer’s account transactions that covers at least 60 days preceding the date of receipt of the consumer’s request.

Financial institutions must provide in its initial disclosure the means by which a consumer can access information about his or her payroll card account, including the telephone number that the consumer may call to obtain his or her account balance, and information on how the consumer can electronically obtain a history of account transactions. If a financial institution opts not to provide a paper periodic statement, the interim final rule specifies two different triggers for beginning the 60-day period for reporting an error and limiting the liability for unauthorized EFTs. If you would like a copy of the interim final rule, please go to:

To access the full Comment Call and Questions, go to : (You will need your CUNA user name and password.) Please submit your comments to MCUL by February 27, 2006.

Potential Impact to Credit Unions

Note: Below is a list of issues the MCUL identified as potentially impacting credit union policies, procedures, or operations. Keep in mind that as each credit union is unique, this list may not be exhaustive.

As the interim final rule currently stands, if the credit union offers or considers offering payroll card accounts, they will have to:


  • Update their initial disclosures to include the means about which consumers can access their payroll card accounts.
  • If the credit union decides to opt out of offering paper statements to payroll card accounts, they will have to adjust their policies and procedures to make sure that information is available to the member through one of the other alternatives (i.e. phone, electronically, or a through a written report of the last 60 days upon the card holders request.)
  • If a financial institution opts not to provide a paper periodic statement, the credit union should review and update any policy and procedures to address the 60-day period for limiting liability for unauthorized EFTs.


  1. Do you believe the option to obtain a written history of account transactions is necessary or appropriate? Please explain.
  2. Do you believe additional transaction information should be provided to payroll card users, or whether certain information should be excluded from the history of account transactions? Please explain.
  3. What is the feasibility of providing consumers with a rolling history of 60 days’ worth of transactions? Please explain.
  4. What is the feasibility of determining when a member has electronically accessed his or her account? Please explain.
  5. Are there other methods of triggering the 60-day time periods for establishing liability for unauthorized EFTs or for error resolution? Please explain.
  6. Do you have any other comments?

If you have any further questions, or would like to submit a response, please contact me at:

Matt Beard
Michigan Credit Union League
112 East Allegan St., Suite 800
Lansing , MI 48933 fax: (517) 482-3762

We Appreciate Your Response.

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