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A surprise in your checkbook
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Posted on Nov 04 2004
According to an article in last Sunday’s Pacific Daily News, the checks we now write will clear faster.
While both Marianas Variety and Saipan Tribune have had articles about this, neither mentioned the effect this will have on our deposits. According to the PDN article, “While the law will speed up the time it takes the check you write to clear, banks won’t be required to reduce the ‘holds’ they place on deposits.” Thus, the checks you write could bounce if they clear before the bank credits your deposits. So, if you are in the habit of depending on the float, you could be in for a surprise.
While this may seem unfair, the Federal Reserve Board might help because it is required to review the rules governing deposit holds. If they determine checks are clearing faster, they will reduce hold periods. Unfortunately, this determination isn’t due for 2 1/2 years. Checks clear faster, banks win. Deposits continue to clear slower, you lose. It’s a “win/win” situation for the banks and a “lose/lose” one for the customer.
Ed Klingbergs
Susupe
