Fed Approves Shift of All Check Processing to One Venue
At the end of February, all paper checks will be processed by the Federal Reserve Bank of Cleveland and there will be no such thing as a non-local check, as a result of rules changes approved last week by the Fed's Board of Governors.
As a result, credit unions and banks will have to make funds available more quickly when someone deposits a paper check. Credit unions have currently can hold the funds on a non-local check for up to five days.
The change will take effect on Feb. 27.
The full rule can be found at: http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20091231a1.pdf