Congressman Ritchie Torres Introduces The Affordable Remittance Act
Tomorrow, Congressman Ritchie Torres (NY-15) will introduce The Affordable Remittance Act into the U.S. House of Representatives.
The Affordable Remittance Act aims to increase access to the FedNow payment system for affordable remittance providers. This bill mandates that the Board of Governors of the Federal Reserve System make FedNow available to such providers, thereby reducing the cost of cross-border remittances and supporting global financial inclusion.
The legislation addresses the high costs associated with international remittance payments, which are a crucial source of financial support for low- and middle-income countries. By ensuring that affordable remittance providers have access to the Federal Reserve’s FedNow payment system, the bill seeks to drive down transaction costs, increase efficiency, and expand financial inclusion.
Key provisions of the legislation include:
- Access to FedNow for Affordable Remittance Providers
a. The Board of Governors of the Federal Reserve System must provide FedNow access to all qualifying remittance providers within 90 days of the enactment of this bill.
- Definition of Affordable Remittance Providers
a. Within 60 days of the bill’s enactment, the Board will define “affordable remittance provider,” considering the following:
b. Shall only include persons whose primary business is facilitating affordable remittance payments;
c. May not include depository institutions;
d. Providers must be registered with the Financial Crimes Enforcement Network (FinCEN) and comply with the Bank Secrecy Act;
e. They must be regulated by a State or Federal consumer protection agency; and
f. The definition must align with the World Bank’s goal of reducing remittance costs to 3% or lower.
- Reporting Requirements
a. The Federal Reserve must annually report to Congress on the trends in the costs of remittances, providing data to monitor the impact of the bill on reducing fees and increasing accessibility.
The full text of the bill can found here.