July 23, 2020

Dear Majority Leader McConnell, Minority Leader Schumer, Chairman Wicker and Ranking Member Cantwell:

The undersigned organizations represent a diverse group of American financial institutions and technology companies. We support inclusion of the E-SIGN Modernization Act (S. 4159), sponsored by Sen. John Thune, in the forthcoming Phase IV economic relief package.

The COVID-19 crisis has disrupted the financial lives of Americans, leading record numbers to turn to digital channels in order to stay on top of their finances.1 However, outdated technical steps required by the federal Electronic Signatures in Global and National Commerce Act (“E-SIGN Act”), which was enacted at the dawn of the Internet in 2000, have prevented some consumers from quickly availing themselves of options to keep their financial lives on track. The same obstacles are affecting the ability of regulated businesses to offer digital options. It is time to update the law.

The E-SIGN Modernization Act addresses a simple but important problem: federal law preferences paper-based processes over equivalent digital options that are beneficial at times of disruption. Consumers who request to engage digitally with companies through services, such as online banking, must jump through additional hoops that are not required when they choose paper-based processes delivered through arguably less-efficient methods, such as the mail.

Since the beginning of the current crisis, companies large and small have found compliance with the E-SIGN Act reasonable demonstration requirement (12 U.S.C. § 7001(c)(1)(C)(ii)) challenging. Financial institutions have faced hurdles to quickly implement loan modifications, transfer balances, complete service requests begun on paper or over the phone, or fulfill requests from displaced customers for access to digital services.

1 Coronavirus crisis mobile banking surge is a shift that’s likely to stick. CNBC (May 27, 2020), available at https://www.cnbc.com/2020/05/27/coronavirus-crisis-mobile-banking-surge-is-a-shift-likely-to-stick.html.