Understanding Regulation CC changes for 2025

Are you prepared for the July 1, 2025, effective date for the Regulation CC cost-of-living adjustments (COLA)? On May 13, 2024, the Federal Reserve Board and the Consumer Financial Protection Bureau announced the inflation-adjusted dollar thresholds for Regulation CC funds availability. Be sure you understand what’s changing and consider these steps to help ensure your implementation strategy is on track.

What’s changed

The following changes have an effective date of July 1, 2025:

• The minimum funds amount that must be available from certain check deposits the next business day will be adjusted from $225 to $275, per § 229.10(c)(1)(vii).
• The amount required to be released for cash withdrawals or similar means by 5 p.m. on the business day when funds are scheduled to be available will be adjusted from $450 to $550 if the financial institution discloses and extends the availability by one business day, per § 229.12(d).
• Note that most financial institutions do not disclose this in their funds availability disclosure and, therefore, do not take this requirement into consideration in their hold process.
• The new-account (§ 229.13(a)(1)(ii)), large-deposit threshold (§ 229.13(b)) and the repeatedly overdrawn threshold (§ 229.13(d)(2)) of $5,525 will each be adjusted from $5,525 to $6,725.

Future adjustments are expected to begin on July 1, 2030, and continue every fifth year thereafter. They will be based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) and rounded to the nearest multiple of $25. 

Next steps

What should you do to help ensure you are ready for the July compliance deadline?

• Update your initial disclosure: For all hold types disclosed, your financial institution should update initial account disclosures to reflect the increases in the amounts required to be made available.
• If you make disclosures available on your website, be sure to update those as well.
• Update your hold notice templates: Hold notice forms that include the amounts of available funds should be updated to reflect the increased amounts that will be available. 
• Update your hold parameters on your teller and/or core system: System parameters that include available funds amounts should be updated to reflect the increased amounts that will be available. 
• Notify your customer about the changes: When a policy change expedites the consumer’s ability to access funds, the regulation requires disclosure of the change within 30 days after implementation. However, nothing prohibits you from implementing these changes prior to July 1.
• Update your policies and procedures: Review your policies and procedures and, if the dollar thresholds are listed, update them.
• Train your staff: Training should be provided to new account personnel, tellers, operations and other applicable staff to help ensure they are knowledgeable about the policy changes and are prepared to discuss the changes with customers or members.
• Consider increasing your monitoring: Determine whether your monitoring should be increased once changes are in effect, to be confident that staff understand them.
• Update your risk assessment: Include the regulation and process changes in your next compliance risk assessment update.
• Consider including the regulatory changes in your compliance audit scope: Be sure your independent audit, scheduled after the changes take effect, includes a review of your change in terms of process and hold transaction testing.

How Wipfli can help

Wipfli specialists can assist with consulting, training, monitoring or audits that include change management, including Regulation CC changes. Contact us to learn more about how we can help you navigate the challenges accompanying regulatory rule changes, product and service changes, and staffing changes, among others. Our compliance consultants can provide the support you need for your organization.