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Financial Services Law Insights and Observations

NYDFS locks maximum check-cashing fee at 2.27 percent

State Issues State Regulators NYDFS Check Cashing Consumer Finance Fees Bank Regulatory

State Issues

On February 14, NYDFS issued an emergency regulation halting annual increases on check-cashing fees and locking the current maximum fee set last February at 2.27 percent. “As our world evolves, so must our approach to regulation, which is why for the first time in Department history, we are reexamining the methodology used to determine the maximum check cashing fee,” Superintendent Adrienne A. Harris stated. “[NYDFS] has a responsibility to take a hard look at the impacts of financial products and services on New Yorkers, especially members of underserved communities.” NYDFS noted that the emergency regulation underscores its concerns over the fixed methodology used to determine annual check-cashing fees, which is based on the Consumer Price Index and is not, according to the Department, “necessarily a reliable or accurate indicator of the costs of operating within a specific sector of business, such as financial services.” NYDFS stated that it intends to promulgate a proposed regulation for a new fee methodology and will seek public comments before a final regulation is issued. The emergency regulation will remain in effect until a final regulation is adopted.