Regulation CC governs how quickly a bank must make deposited funds available and when it may place a longer hold. The general rule is fast: the first $275 of a check deposit must be available the next business day, and most local checks must be available by the second business day. A bank can extend availability only by invoking one of six specific exception holds, and only if it gives the customer the required written notice. Placing a hold without a valid exception or without proper notice is a Regulation CC violation.
Key Takeaways:
- Next-day availability applies to cash, electronic payments, and certain low-risk deposits; most other checks get second-business-day availability
- The first $275 of a check deposit must generally be available the next business day
- A bank can extend a hold only through one of six exception holds: new accounts, large deposits, redeposited checks, repeated overdrafts, reasonable cause to doubt collectibility, and emergency conditions
- Exception holds require a written notice that states the reason and the date funds will be available
- The hold amounts, the $275 figure, and the notice rules are set by 12 CFR Part 229 and are periodically adjusted for inflation
The General Availability Rules
Regulation CC, which implements the Expedited Funds Availability Act, sets baseline availability schedules that a bank cannot make slower without an exception.
Next-Business-Day Availability
The following must be available no later than the next business day after the banking day of deposit:
- Cash (when deposited in person to an employee)
- Electronic payments, including ACH credits and wire transfers
- U.S. Treasury checks deposited to the payee's account
- U.S. Postal Service money orders, and checks drawn on a Federal Reserve Bank or Federal Home Loan Bank
- State and local government checks, cashier's, certified, and teller's checks (when deposited to the payee's account with any special deposit conditions met)
- The first $275 of the aggregate check deposits on any banking day
Second-Business-Day Availability
Most other checks, including local checks drawn on other banks, must be available by the second business day after deposit. Because nearly all checks now clear electronically, the once-meaningful local versus nonlocal distinction has effectively collapsed into a uniform schedule for most deposits.
The amount that must be made available, and the $275 figure, are adjusted for inflation by the agencies. Always confirm the current thresholds against the regulation, since they change.
The Six Exception Holds
A bank may extend funds availability beyond the standard schedule only by invoking one of six exceptions defined in 12 CFR § 229.13. Each has its own conditions.
-
New accounts. During the first 30 days after an account is opened, the standard schedules do not fully apply, and the bank has more flexibility on availability for check deposits.
-
Large deposits. When the aggregate check deposits on any banking day exceed a set threshold (an inflation-adjusted amount), the bank may hold the amount above that threshold longer. The first portion still follows the normal schedule.
-
Redeposited checks. A check that was previously returned unpaid and is deposited again may be held.
-
Repeated overdrafts. If the account has been repeatedly overdrawn within the preceding six months under defined conditions, the bank may extend holds.
-
Reasonable cause to doubt collectibility. If the bank has a reasonable, documented basis to believe a check will not be paid, it may hold the funds. The bank must describe the specific reason in the hold notice; a general suspicion is not enough, and the reason cannot be discriminatory.
-
Emergency conditions. Events such as communications or computer outages, or other emergencies beyond the bank's control, can justify extended holds.
For most exception holds, the bank may extend availability by a reasonable period, generally up to an additional number of business days defined in the regulation. The maximum hold periods are bounded; a hold cannot be open-ended.
The Notice Requirements
This is where banks most often stumble. Whenever a bank places an exception hold, it must provide a written exception hold notice to the customer. The notice must include:
- The account number
- The date of the deposit
- The amount being delayed
- The specific reason the hold was placed (the applicable exception)
- The date the funds will be available
For most exception holds, the notice must be provided at the time of deposit if the customer is present, or mailed by the business day after the banking day of deposit if it isn't given at deposit. For the reasonable-cause exception specifically, the notice must state the particular reason the bank doubts collectibility, and the bank cannot charge overdraft or return fees if it failed to give a required reasonable-cause notice and the check was in fact paid.
Banks must also provide a general funds availability policy disclosure at account opening and make it available on request, and post availability notices at staffed teller stations and ATMs.
Where Banks Get Cited
Examiners reviewing Regulation CC in a deposit compliance exam look for a consistent set of problems:
- Holds without a valid exception or beyond the maximum permitted period
- Missing or late exception hold notices, especially when the hold was placed after the customer left
- Vague reasonable-cause notices that don't state a specific, documented reason
- Charging fees that should have been waived when a required reasonable-cause notice was not given and the check cleared
- Stale availability policy disclosures that don't match current practice or thresholds
- Inconsistent application of holds in a way that could raise fair treatment concerns
Reg CC findings frequently appear alongside Regulation E error resolution timing issues because both are deadline-driven deposit rules that examiners test against transaction records. Both also show up in the document request lists examiners issue, covered in our FDIC exam document request list.
Reg CC holds are a notice-and-deadline problem: the hold can be valid and still cited if the notice was wrong or late. See how Canarie tracks hold decisions, notices, and timing as evidence →
Building a Defensible Hold Process
A clean Regulation CC process has a few characteristics:
The exception is documented at the moment of the hold. When a teller or system places an exception hold, the specific exception and the supporting reason are recorded, not reconstructed later.
The notice is generated and delivered on time. The system produces the correct notice with the reason and availability date, and proves it was provided at deposit or mailed by the next business day.
Reasonable-cause holds carry a real reason. Each one cites a specific, documented basis, not a generic statement, and the fee-waiver rule is applied when a required notice was missed.
Disclosures stay current. The availability policy disclosure matches actual practice and current thresholds, and is provided at account opening.
The common thread is evidence. A hold can be entirely lawful and still produce a finding if the bank cannot show the notice was correct and timely. For how deposit compliance fits into broader exam readiness, see what happens during a bank examination.
Frequently Asked Questions
How long can a bank hold a check under Regulation CC?
Under the standard schedule, the first $275 is available the next business day and most checks by the second business day. A bank can extend availability only through one of six exception holds, and even then the regulation caps how many additional business days the funds may be held. Holds cannot be open-ended.
What are the exception holds under Reg CC?
There are six: new accounts, large deposits, redeposited checks, repeated overdrafts, reasonable cause to doubt collectibility, and emergency conditions. Each has specific conditions, and most require a written exception hold notice stating the reason and the date funds will be available.
What is a reasonable cause hold?
A reasonable-cause hold lets a bank extend availability when it has a specific, documented basis to believe a check will not be paid. The bank must state the particular reason in the hold notice, cannot rely on a general suspicion, and cannot charge return or overdraft fees if it failed to provide the required notice and the check was actually paid.
Does Regulation CC require a hold notice?
Yes. Whenever a bank places an exception hold, it must provide a written notice that includes the account number, deposit date, amount delayed, the specific reason, and the date funds will be available. The notice must be given at deposit if the customer is present or mailed by the business day after the banking day of deposit.
What is the first amount that must be available next day?
The first $275 of the aggregate check deposits on a banking day must generally be available the next business day. This figure is adjusted for inflation by the agencies, so confirm the current amount against the regulation.
Make Holds and Notices Provable
Regulation CC compliance is rarely about whether a hold was justified. It's about whether the bank can prove it gave the right notice, with the right reason, on time. When that proof lives in paper notices and teller memory, examiners find gaps.
Canarie captures each hold decision, the exception relied on, and the notice provided, with the timing evidence that shows the bank met its Reg CC obligations.