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Financial Institution Letters


November 2, 2000

SUBJECT: Notice of Consumer Consent Requirements Applicable to the Electronic Delivery of Consumer Disclosures

The Electronic Signatures in Global and National Commerce Act (E-Sign Act), signed into law on June 30, 2000, provides a general rule of validity for electronic records and signatures for transactions in or affecting interstate or foreign commerce. Subject to certain exceptions, the law's effective date is October 1, 2000, with record retention requirements effective beginning March 1, 2001.

Included among the E-Sign Act's provisions is a section addressing the use of electronic records for an institution that wishes to exclusively provide electronic disclosures to consumers in lieu of written disclosures. Specifically, Section 101(c)(1) of Title I allows a financial institution to issue electronic records to a consumer to satisfy any statute or regulation that requires such information to be in writing, after first obtaining the consumer's affirmative consent. Before consent can be given, a consumer must be provided with information regarding:

  • any right or option to receive a disclosure in paper form;
  • whether the consent applies only to a particular transaction or to categories that may be provided during the course of the parties' relationship;
  • the right to withdraw consent to have records provided electronically, including any conditions, consequences, or fees associated with doing so. The institution must describe the procedures for withdrawing consent and for updating information needed to contact the consumer electronically;
  • how the consumer may obtain a paper copy of the record upon request; and
  • the hardware and software requirements for access to and retention of the electronic information.

Institutions currently providing electronic disclosures or statements to consumers (pursuant to final and/or interim rules issued by the Federal Reserve Board) should note that agreements reached with consumers prior to October 1, 2000, to deliver information electronically, are exempt from the requirements of Section 101(c)(1). However, for any agreements made with new or existing customers on or after October 1, 2000, the requirements of Section 101(c)(1) will supersede all other consumer consent procedures relating to the use of electronic disclosures set forth in other regulations.

Financial institutions should review any products delivered through electronic means and the systems that support them to ensure compliance with applicable provisions of the Act. Attached is a complete copy of the E-Sign Act. Title I contains details on the consumer consent provisions, specific exception to the requirements, and related definitions.

For more information, please contact Eric L. Kooistra, Review Examiner in the Division of Compliance and Consumer Affairs, at (202) 942-3339 (e-mail or Robert A. Patrick, Counsel in the Legal Division, at (202) 898-3757 (e-mail

Stephen M. Cross

Attachments: Electronic Signatures in Global and National Commerce Act
PDF (128 KB File - PDF Help or Hard Copy)

Distribution: FDIC-Supervised Banks (Commercial and Savings)

NOTE: Paper copies of FDIC financial institution letters may be obtained through the FDIC's Public Information Center, 801 17th Street, NW, Room 100, Washington, DC 20434 (800-276-6003 or (703) 562-2200).

Last Updated 11/2/2000

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