A: Any P2P payment provider that meets the definition of a financial institution, as discussed in Electronic Fund Transfers Coverage: Financial Institutions Question 1
, is a financial institution under Regulation E. Thus, if a P2P payment provider directly or indirectly holds an account belonging to a consumer, they are considered a financial institution under Regulation E. 12 CFR 1005.2(i). An example of an account that a non-bank P2P payment provider may directly or indirectly hold is a prepaid or mobile account whose primary function is to conduct P2P transfers. 12 CFR 1005.2(b)(3); Comment 2(b)(3)(i)-10. Additionally, as discussed in Electronic Fund Transfers Coverage: Financial Institutions Question 1
, non-account-holding providers of P2P payment or bill payment services are considered covered financial institutions under Regulation E if the provider issues an access device and agrees with a consumer to provide EFT services. 12 CFR 1005.2(i). For example, a P2P provider may enter into an agreement with a consumer for a mobile wallet that the consumer can use to initiate debit card transactions from their external bank account to another person’s external bank account.
Any entity defined as a financial institution under Regulation E has error resolution obligations in the event that a consumer notifies the financial institution of an error, with limited exceptions. 12 CFR 1005.11. See Electronic Fund Transfers Error Resolution Question 2
for more information about these error resolution obligations.