The Federal Reserve Board on Monday proposed requiring banks to clear most out-of-town checks within four days, rather than five days as currently mandated.
Writing in an advance notice of proposed rulemaking, the Fed said the change should not burden the industry. Recent surveys show that nearly two- thirds of out-of-town checks already are settled within four days, it said.
Banks could retain the five-day period for categories of checks that routinely take more than four days to settle. The bank would have to collect check-clearing data to support its exemption.
Comments are due March 15. A final rule is not expected before spring 2000.