Febraban Orders Banks to Notify Customers Before Interbank Auto Debits

Overview

• Signatory banks must warn account holders up to five days before any automatic debit initiated by another institution, and the charge can only occur after that notice.
• Customers who do not recognize a scheduled debit may cancel it at the institution that requested the charge.
• Notifications may be sent via the bank’s app, SMS, or another verifiable channel and must identify the receiving institution, the amount, and customer-service contacts.
• Twenty-five banks covered by Febraban’s self-regulation have 30 days to adapt their systems to the new requirement.
• The measure supplements the CMN’s 2020 rule that places authorization duties on initiating institutions and was prompted by rising complaints and lawsuits, including cases involving INSS beneficiaries.