In response to rising inflation, the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau (CFPB) have jointly announced adjustments to several dollar thresholds in Regulation CC, which implements the Expedited Funds Availability Act.Effective July 1, 2025, and valid for the next five years, the following Regulation CC thresholds will increase:
- Minimum Amount: $275 (previously $225)
- Cash Withdrawal Amount: $550 (previously $450)
- New Account Amount: $6,725 (previously $5,525)
- Large Deposit Threshold: $6,725 (previously $5,525)
- Repeatedly Overdrawn Threshold: $6,725 (previously $5,525)
- Civil Liability Minimum/Maximum for Individual Action: $125 (previously $100)
- Civil Liability Maximum for Class Action: $672,950 (previously $552,500)
These adjustments reflect a 21.8% increase in the Consumer Price Index between July 2018 and July 2023, following the methodology finalized by the agencies in 2019 to review and adjust the thresholds every five years based on inflation.The higher thresholds provide financial institutions with greater flexibility in holding larger deposits for extended periods under certain Regulation CC exceptions, potentially impacting funds availability for consumers.
As inflation continues to impact the economy, it's crucial for financial institutions to stay ahead of regulatory changes and ensure compliance. These adjustments to Regulation CC underscore the importance of regularly reviewing and updating policies and procedures to align with the latest requirements.
While the changes may present operational challenges, they also offer an opportunity for financial institutions to enhance their compliance programs and maintain a strong commitment to consumer protection. As the industry adapts to the new thresholds, it's essential for financial institutions to prioritize staff training, system updates, and ongoing monitoring to ensure a seamless transition and continued adherence to regulatory requirements.The agencies have committed to reviewing and adjusting the Regulation CC thresholds every five years based on inflation, with the next round of updates expected in 2030.By staying proactive and embracing these changes, institutions can position themselves for long-term success while maintaining the highest standards of compliance and customer service.