The Expedited Funds Availability Act and Regulation CC establish time limits for holds on deposits by check, cash and wire transfer. Additionally, they establish rules regarding the prompt collection and return of checks through the banking system. The Federal Reserve Board's Reg. CC implements the provisions of the Act.
Next-Day Availability
Cash Deposits. Deposits made in person to an employee will be made available the next business day after the day of deposit. Otherwise, deposits not made in person to an employee must be made available the second business day after the day of deposit.
Note: Under the regulation business day means a calendar day other than a Saturday or a Sunday, January 1, the third Monday in January, the third Monday in February, the last Monday in May, July 4, the first Monday in September, the second Monday in October, November 11, the fourth Thursday in November, or December 25. If January 1, July 4, November 11, or December 25 falls on a Sunday, the next Monday is not a business day. On the other hand, banking day means that part of any business day on which the credit union is open for carrying on transactions. Our credit union is open Monday through Wednesday, 8:30 am to 5:00 pm; Thursday, 8:30 am to 6:00 pm; Friday, 8:30 am to 5:30 pm. Saturday business should be considered as being processed on the following Monday or next business day.
Electronic Payments. Funds received for deposit in an account by an electronic payment must be made available for withdrawal the next business day after the day of receipt. An electronic payment is considered received when the financial institution receives both the payment in finally collected funds and also receives information on the account and amount to be credited.
Certain Check Deposits. The following should generally be made available the next business day after the day of deposit:
- US Treasury checks deposited into the payees account.
- The following types of checks deposited in person to an employee and deposited into the payees account: U.S. Postal Service money orders; checks drawn on a Federal Reserve Bank or a Federal Home Loan Bank; checks drawn by a state or local government in the same state as the financial institution; or cashiers checks, certified checks, or teller checks.
- $100 or the aggregate of any deposit made by the member, whichever is less, that is not subject to next-day availability.
Second-Business-Day Availability:
Local Checks. Will be available for withdrawal no later than the second business day following the day of deposit. Checks deposited by or at a local institution or checks payable by non-institution payor through a local paying institution are considered local checks. A local paying institution is defined as an institution located in the same Fed check-processing region as the physical location of the institution branch where the check was deposited.
Fifth-Business-Day Availability:
Non-Local Checks: Will be available for withdrawal no later than the fifth business day following the day of deposit. Checks that are payable by, through, or at a non-local institution are considered non-local checks. A non-local institution is defined as one that is not located in the same check-processing region as the depository institution.
Checks drawn on Federal Reserve Banks, Federal Home Loan Banks, and state and local governments, and cashiers checks, certified checks, and teller checks that are non-local checks are not subject to next-day availability.
Cash Withdrawal Time-Period Adjustment:
- Up to $400 of the deposited funds may be available by 5:00 p.m. on the day that funds would be made available under the schedule.
- Cash withdrawals for the remainder of funds (over the initial $400) can be delayed until the next business day.
- We may continue to limit withdrawals at ATMs to amounts under $400.
- We may extend the availability time periods for cash or other similar withdrawals on deposits of local and non-local checks by one business day.
Other Extensions: We may have a one-day extension for any time periods on deposits that are:
- Deposited in an account at an institution or branch located in Alaska, Hawaii, Puerto Rico, or the US Virgin Islands.
Exceptions
New Accounts. If you are a new member, the following special rules will apply during the first 90 days your account is open:
- Cash and electronic deposits may be available by the next business day.
- If the deposit meets certain conditions (for example, the checks must be made payable to you), the first $5,000 of deposits into the payee’s account of checks drawn on the U.S. Treasury, Federal Reserve Banks, Federal Home Loan Banks, state and local governments, and cashiers, certified, teller, and travelers checks, will be made available on the next business day. Amounts over $5,000 may be made available no later than the ninth business day following the day of deposit.
- If your deposit of checks is not made in person to our employee, the first $5,000 will not be available until the second business day after the day of your deposit.
- Deposits to new accounts are not subject to any other availability time schedules, nor are they subject to the $100 cash withdrawal requirement.
Large Deposits. The standard availability schedules do not apply to deposits of checks that may be held and that aggregate more than $5,000 in any one day. The first $5,000 is subject to the standard availability schedules. Amounts over $5,000 are not subject to any hold restrictions except that the deposits can be held for a reasonable time. An extension of up to five business days for local checks and up to six business days for non-local checks is deemed reasonable. If we have reason to believe the check(s) deposited may be susceptible to being returned (either due to information we may gather or due to the history of returned items or problems with your account, we may find it necessary to extend the hold period for up to 20 business days. The availability requirements for cash and low-risk (non-hold) checks apply to large deposits.
Re-deposited Checks:
- Checks that have been returned unpaid and re-deposited are not subject to the hold schedules unless: 1.) The check was returned for a missing endorsement and the endorsement has been obtained, and 2.) The check was returned because it was postdated and is not postdated when re-deposited.
- $100 of the deposit must be made available by the next business day after the day of deposit.
- An extension of up to five business days for local checks and six business days for non-local checks is deemed reasonable. If we have reason to believe the check(s) deposited may be susceptible to being returned again (either due to information we may gather or due to the history of returned items or problems with your account, we may find it necessary to extend the hold period for up to 20 business days.
Repeated Overdrafts:
- The hold schedules for local and non-local checks do not apply to an account that has been repeatedly overdrawn. An account has been repeatedly overdrawn if it had a negative balance (or would have had a negative balance if checks had been paid) for six or more banking days, within the preceding six months, or had a negative balance of $5,000 or more (or would have had a negative balance of such amount) for two or more banking days within the preceding six months.
- An account retains its repeated overdraft status for six months from the last overdraft.
- The time periods for holding funds may be extended for a reasonable period of time on these accounts.
- If we have reason to believe the check(s) deposited may be susceptible to being returned (either due to information we may gather or due to the history of returned items or problems with your account, we may extend the hold period for up to 20 business days.
Reasonable Cause to Doubt Collectibility:
- Hold schedules for local and non-local checks do not apply when there is reasonable cause to doubt collectability of an item.
- Cash and electronic payments must receive next day availability.
- However, next day availability requirements for US government checks, checks drawn on a Federal Reserve Bank or Federal Home Loan Bank and certified, cashiers, and teller checks, and checks not deposited in person to an employee do not apply.
- If we extend the time for funds availability due to doubts about collectability of an item and do not give you a hold notice at the time of the deposit, we may not assess any overdraft fee if the overdrafts would not have occurred except for the delayed availability of funds and the check was paid by the paying institution.
- Any extension of time must be reasonable. If we have reason to believe the check(s) deposited may be susceptible to being returned (due to information we gather or the history of problems with your account), we may extend the hold period for up to 20 business days.
- We must keep records for two years of the notice provided to the member and a statement of the facts which gave us reason to doubt the collectability of the item(s).
Emergency Conditions:
- The availability schedules do not apply to check deposits if there is: 1.) An interruption of communications or computer or other equipment functions, 2.) A suspension of payments by another financial institution, 3.) A war, or 4.) Emergency conditions beyond the control of the depositary institution.
- Holds may be placed on funds until a reasonable time period after the emergency passes.
Notice of Hold based upon an Exception:
- Notice must be given at the time of deposit or when the exceptions are invoked. The notice will include: account number, date of deposit, amount of deposit, amount that is delayed, the reason for exception, and the day that funds will be available for withdrawal if known.
- The notice need not be given at the time of deposit when: 1.) The deposit is not made in person to an employee, or 2.) The facts upon which the determination to invoke an exception hold only become known to us after the deposit is made. In this case we must send notice by the next business day after the facts become known.
Payment of Interest
Interest must begin to accrue on deposits made to an interest-bearing account on the day the depository institution receives credit for the funds.
- We may rely on the availability schedule of the Federal Reserve Bank, Federal Home Loan Bank, or correspondent institution to determine when funds are received.
- We do not have to pay interest on deposits that are returned unpaid.
Other Methods of Holds on Funds
If we cash a check for you that is drawn on another institution, we may withhold the availability of a corresponding amount of funds that are already in your account (or another account(s) you hold with us). Those funds will be available at the time funds from the check we cashed would have been available if you had deposited it.
Revision date: November 29, 2005
