WASHINGTON — According to the Federal Reserve, despite increasing usage of Check 21 authorities, it is too soon in the process to shorten check clearing times.

“Based on the results of the March 2006 survey, banks are now learning more quickly about the nonpayment of checks than reported in a similar survey conducted by the Board in 1995,” the Fed's Report to the Congress on Check 21 read. “This improvement however, has not been sufficient to warrant changes in the maximum permissible hold period mandated by the [Expedited Funds Availability Act] and Regulation CC…In addition, while the use of Check 21 authority has been growing quickly since the March 2006 survey, much broader adoption of the new technologies and processes by the industry will likely be necessary before total check return times diminish appreciably.” The Fed stated in a footnote of the report that EFAA legislative history calls for the return of two-thirds of the checks in a given category (before a bank must make the deposited funds available for withdrawal at the opening of business) to qualify as “most” checks.

The Fed's report to Congress also pointed out that about 90% of all consumer deposits and half of all deposits of next-day checks are credited before the required amount of time.