On July 9, 2015, the Consumer Financial Protection Bureau (“CFPB”) released a set of principles setting out its vision for the consumer protections that should be incorporated into the development of faster payment systems. 2 The principles address a number of issues, including consumer control, fraud and error resolution, transparency, cost, and access, among others. They encourage businesses that are developing faster payment systems to clearly inform consumers about when, how, and the terms under which they have authorized a payment, to provide mechanisms for reversing erroneous and unauthorized transactions, to clearly disclose any fees, and to make the system broadly accessible.
The principles also highlight a number of best practices with respect to privacy and data security. Specifically, the principles encourage businesses to provide consumers with information—when such information will be helpful to consumers—about how their data is transferred through the payment system, including what data is transferred, who has access to it, how the data can be used, and its potential risks. The principles also encourage businesses to build into their systems protections to detect and limit errors, unauthorized transactions, and fraud. The principles call for such systems to allow gateway institutions to offer consumers enhanced security protections and limit the value of consumer payment credentials by implementing tokenization or other such tools.