“I urge you to think creatively about how you can put more control directly in the hands of your customers. This will help them as they worry about data breaches, and could help you minimize the incidents of fraudulent use of credit cards and debit cards and other payment methods,” Cordray writes. “This will help people also to assert greater control of their financial lives. In short, you have the power, right now, to help consumers help themselves in ways that will materially improve their lives and that could reduce your costs.
“And if you manage to do so, we believe you will enhance the loyalty and engagement of your customers with positive results,” he continues. “Those who do not move quickly in this direction may soon find that they risk losing business to those who do. So I recommend that you keep pushing forward to offer consumers more control over their accounts.”
The letters, which the CFPB claims were sent to several banks, credit unions, and financial companies, reiterated suggestions – and not mandates – that Cordray says he has shared with these institutions over the years.
They include; broader adoption of the Open Credit Score Initiative, safe banking accounts with no overdraft features, and cash withdrawal limits for seniors.
He also urges these institutions to embrace new technology.
“There is enormous value in new technology that makes it feasible, right now, to enable consumers to exert much greater control over their credit cards, debit cards, and other payment methods,” Cordray writes. “Digital servicing platforms offer the potential for enhanced security and the peace of mind that are made possible by establishing controls that will make it more difficult for unauthorized transactions to occur.
“Moreover, such platforms can allow consumers to exert greater control on their own spending and those they authorize to use their accounts by establishing settings that limit how, where, when, and to what extent their accounts are accessed—and to do so much more easily and conveniently.”
The letter appears to be Cordray’s last act as CFPB director – a position he stepped down from last week.
On the eve of his departure Cordray sent letters to the heads of financial CEOs, urging banks to give their clients more control over their own finances.