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History
- Print number 7942a
- Amend (t) and recommit to banks
- Referred to banks
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Relates to certain fees charged to cash checks, drafts and/or money orders
In Assembly Committee · Banks · Sponsor David Koon
Full text
The text isn't available here yet. Check nysenate.gov.
Sponsor's memo
BILL NUMBER:S7942A
Title of bill
An act to amend the banking law, in relation to certain fees charged to cash checks, drafts and/or money orders
Purpose
This legislation would increase the fee set under Section 374 of the Banking Law for cashing checks over $200 provided that any fee is clearly and conspicuously posted. No fee may be charged within New York City.
Summary of specific provisions
Section 1 amends Section 374 of the Banking Law to increase the fee for checks cashed over $200 from $1.00 to $3.00 for businesses that cash checks as an incident to their primary business. The bill would prohibit any fee from being charged within New York City and provides that any fee must be clearly and conspicuously posted.
Section 2 sets the effective date.
Justification
Banks are increasingly refusing to cash checks for individuals who do not maintain accounts with that bank. Licensed check cashers provide this service for individuals without bank accounts in the New York City region, but do not operate in any significant numbers in upstate New York. According to the check cashers website, there are 619 licensed check cashers in the New York metro region, but only 25 in all of upstate including: one in Albany, two in Buffalo, two in Poughkeepsie, five in Rochester, three in Schenectady and three in Syracuse. As such, working class families increasingly turn to supermarkets and other retailers as the only outlet available to them to cash payroll and government benefit checks.
The retail outlet for cashing checks is in jeopardy of being closed. Section 374 of the Banking Law limits businesses who cash checks as an incident to their primary business activity to a fee of $1.00. The fee set in Section 374 was increased last in 1999 (Chapter 467, Laws of 1999). Retailers complain that their actual costs average between $3-$4 depending upon the number of bad checks they encounter.
The bill has been structured so as to not increase the fee for part-time workers or individuals earning the minimum wage. The bill has also been drafted so as to exclude New York City where the majority of check cashers operate. The fee authorized under this bill is less than the rate of 1.83% that check cashers may charge. For a $200 check, the check cashers' fee is $3.66; for a $500 check, the fee is $9.15. This bill will encourage retailers to continue cashing checks for individuals without bank accounts in
those areas of the state where there is a scarcity of licensed check cashers.
Prior legislative history
New Bill.
Fiscal implications
None.
Effective date
Immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.