Comparison of the Fair Credit Billing Act (FCBA) with the Electronic Funds Transfer Act (EFTA)
The FCBA and the EFTA are two federal laws that provide consumer protection in financial transactions. Here's a comparison:
Applicability: The FCBA applies to credit card transactions, including purchases made with cards, balance transfers, cash advances, and any other credit transactions. The EFTA, on the other hand, covers electronic fund transfers, which include debit card transactions, ATM withdrawals, and automatic bill payments.
Billing Errors: The FCBA specifically addresses billing errors, which could include unauthorized charges, charges for goods or services not received, charges for incorrect amounts, among other things. If a consumer notifies the issuer of an error within 60 days, the issuer must investigate and correct the error. The EFTA also has protections against errors, but they are not as comprehensive as the FCBA's protection. Moreover, the EFTA's error resolution processes typically have longer investigation timeframes compared to the FCBA.
Liability: Under the FCBA, a consumer's liability for unauthorized use of their credit card is limited to $50. If a consumer reports the loss or theft of their credit card before any unauthorized charges are made, their liability drops to $0. Under the EFTA, a consumer's liability for unauthorized use of their debit card depends on when they report the loss or theft of the card: If they notify the institution within two business days of discovering the loss or theft, their liability is limited to $50. However, if they wait longer than two business days, their liability could increase up to $500 or even more. Similarly, if they fail to report the transaction within 60 days of the institution mailing them the statement, they could lose access to the disputed funds during the investigation timeframe.
Dispute Resolution: Both laws require institutions to investigate and resolve disputes within specific time frames, but the procedures, time frames, and protections vary.
Overall, the FCBA and the EFTA have similar consumer protection objectives, but the protections, rights, and liabilities differ, depending on the nature of the transaction and the law applied.