WASHINGTON — The Federal Reserve expects to turn a profit on its check processing operations for a second consecutive year in 2011 as the proportion of payments cleared electronically continues to increase.
The central bank on Monday said it expects to earn a 2% profit on check processing services provided to banks in 2011. The increase comes as the Fed plans to trim fees on certain services next year while raising prices on a range of electronic processing options.
The Fed on Monday said it would cut fees paid for Check 21 and electronic return services in 2011 by 14% and 20%, respectively. Fees on FedACH service, Fedwire Funds and National Settlement Services and Fedwire Securities Services are set to increase by 3% in 2011.
Next year would mark the second consecutive year in which the Fed has earned a profit on its check processing services. The Fed adjusts its pricing structure on the services annually.
The Fed estimates it earned about 2.9% on check processing operations this year.
Between 2000 and 2009, the Fed failed to turn a profit on its check processing operations. Still, from 2000 and 2009, the Fed recovered nearly 98% of its costs related to check processing.