What is the Electronic Funds Transfer Act?

The Electronic Funds Transfer Act (EFTA) is a federal law that was passed in 1978 to govern certain types of electronic money transfers. EFTA is used to protect consumers who use electronic methods to transfer funds, such as electronic funds transfers (EFTs) and debit cards. In Oregon, EFTA applies directly to banks and savings associations, credit unions, ATM networks, and other issuers of debit cards, as well as other financial institutions involved in electronic funds transfers. The purpose of EFTA is to ensure that electronic funds transfers are conducted quickly, securely, and accurately by monitoring and regulating the practices of banks and other financial institutions that offer EFT and debit card services. EFTA includes rules that protect against errors, fraud, and unauthorized transfers. It also requires that customers receive clear and timely disclosures of their rights and responsibilities when entering into EFT and debit card transactions. EFTA also establishes limits on the amount of liability customers face in the event of an error, unauthorized, or fraudulent transaction. The law limits the customer’s liability to $50 in most cases, and it requires the financial institution to investigate the circumstances, correct any errors, and make the customer whole. In addition, EFTA gives consumers access to records of their electronic funds transfers and requires financial institutions to provide a copy of the transfer record upon request.

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What is the Electronic Funds Transfer Act?

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