Contending that credit unions and other financial institutions are coercing consumers into accepting electronic statements, the National Consumer Law Center called on the CFPB Monday to require financial institutions to offer paper documents as the "default option."
"Paper statements may seem old fashioned, but consumers have good reasons to continue receiving them," staff attorney Chi Chi Wu, a co-author of the report, said. "Paper has its advantages."
"The CFPB needs to act to ensure that consumers [are] not coerced into electronic statements," the report stated. "While electronic statements can be a fine option for consumers who choose them, paper should be available for those who do not."
The coercion includes imposing a fee for paper statements, the report said, adding that financial institutions should allow consumers to opt-in for e-statements at their own will.
In the report, the NCLC added that millions of Americans do not have broadband Internet service at home, making it difficult for them to access e-statements. For instance, 55% of Americans over 65 do not have Internet service at home, the report stated.
Many consumers are likely to pay more attention to a statement they receive in the mail, the NCLC said, adding that e-statements are easy to overlook and require effort on the consumer's part to access.
The NCLC added that some financial institutions are "aggressively pushing" consumers into e-statements and are using tactics that are questionable and "arguably illegal."
Federal consumer protection laws require written statements – which require paper, the NCLC said – for credit card accounts, accounts accessible by an ATM or other electronic transactions, and mortgage accounts, the report stated.
The Electronic Signatures in Global and National Commerce Act – also known as the E-Sign Act – requires that consumers be given the option to receive electronic or printed statements.
Some financial institutions have been offering consumers accounts that will not allow them to overdraft. Many of those accounts do not include checks – only a debit card. In addition, they often do not provide a printed statement in an effort to keep the cost of servicing the account low.
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