Getting to know the EFTA

The Electronic Fund Transfer Act (EFTA) is a statute that offers protection to consumers when transferring funds electronically. The law protects consumers that use credit cards, debit cards, and Automated Teller Machines (ATMs). The law also protects these consumers from transaction errors, as well as handling liabilities that may result from the loss or theft of a debit or credit card. Electronic fund transfers are transactions that rely on computers, phones, or magnetic strips to authorize financial institutions to transfer funds. Electronic transfers are done at point-of-sale terminals, automated teller machines, with checking and savings accounts, or using pre-authorized withdrawals and automated clearinghouses. The EFTA law protects all electronic transfers, regardless of where the transaction takes place.

The EFTA provides guidelines that banking and other financial institutions should follow when handling errors or fraud cases. Under the law, consumers...