What's happening
This bill prohibits banks from charging fees to anyone cashing checks drawn on their accounts, regardless of customer status.
Why it matters
Helps unbanked and underbanked individuals. By banning check-cashing fees for non-customers, the bill removes a common financial barrier faced by people who don't have bank accounts, making it easier for them to access funds without losing money to fees.
Limits predatory practices and potential double-charging. Banks can no longer charge both the person cashing the check and the account holder for the same transaction, reducing the chances of multiple fees being collected on a single check.
Guarantees ID protections but not check-cashing rights. While the bill ensures that a valid driver's license, non-driver ID, or US passport is sufficient identification for cashing a check, it does not obligate banks to cash checks if there are insufficient funds, so check recipients are still protected against bounced checks.
Supports fair access while preserving bank security. The law allows banks to verify identity to prevent fraud, balancing easier access to funds with continued requirements for proper identification and fraud prevention.
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Who cares
Noncustomer check recipients
The bill would bar banking organizations from charging them to cash checks or drafts payable to them and drawn on accounts at those institutions.
Banking organizations
They would face new fee restrictions but could still require sufficient identification and decline to cash checks or drafts when the underlying account lacks sufficient funds.
Bank account holders
The bill expressly preserves banking organizations’ ability to charge account holders service charges for cashing checks or drafts.
Headline styles
Ban Bank Check Cashing Fees
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred 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.
Ban Bank Check Cashing Fees
In Assembly Committee · Banks · Sponsor Pamela J. Hunter
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2453
2019-2020 Regular Sessions
IN SENATE
January 25, 2019
Introduced by Sen. JORDAN -- read twice and ordered printed, and when printed to be committed to the Committee on Banks
AN ACT to amend the banking law, in relation to prohibiting certain check cashing fees
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 9-h of the banking law, as added by chapter 90 of the laws of 1985, is amended to read as follows:
§ 9-h. Imposition of service charges prohibited. 1. No banking organization shall impose any service charge with respect to any deposit account as a result of the loss of a check or money which is properly deposited with the banking organization by delivery to an employee of the banking organization for credit to the deposit account and for which a written receipt is issued by the employee.
2. No banking organization shall impose, or seek to impose, any service charge, or collect any fee, for the cashing of a check or draft drawn on an account at such banking organization, from a person to whom such check or draft is payable, regardless of whether or not such person to whom such check or draft is payable is a customer or account holder of the banking organization upon which such check or draft is drawn. Nothing in this subdivision shall require a banking organization to cash a check or a draft where the account from which such check or draft is payable does not maintain sufficient funds to pay such check or draft. Nothing in this subdivision shall further prohibit any banking organization from charging any account holder any service charge for the cashing of a check or a draft. Nothing in this subdivision shall additionally be deemed to prevent any banking organization from requesting to examine from any person seeking to cash a check or a draft drawn on such banking organization, for sufficient identification necessary to properly identify such person as the person to whom the check or draft is payable. For purposes of this section, a valid and up to date driver's license, non-driver's identification card, or United States passport shall be deemed to constitute sufficient identification.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05105-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to prohibiting certain check cashing fees
Purpose or general idea of bill
This bill would amend the banking law, to prohibit any banking organiza- tion from imposing, or seeking to impose, any service charge, or from collecting any fee, for the cashing of a check or draft drawn on an account at such banking organization, from a person to whom such check or draft is payable, regardless of whether or not such person is a customer of such banking organization.
Summary of specific provisions
This bill would amend section 9-h of the banking law to:
*Prohibit any banking organization from imposing, or seeking to impose, any service charge, or from collecting any fee, for the cashing of a check or draft drawn on an account at such banking organization, from a person to whom such check or draft is payable, regardless of whether or not such person is a customer of such banking organization;
*Expressly provide that nothing in this bill would:
o Require a banking organization to cash a check or a draft where the account from which such check or draft is payable does not maintain sufficient funds to pay such check or draft;
o Prohibit any banking organization from charging any account holder any service charge for the cashing of a check or a draft; and/or
o Be deemed to prevent any banking organization from requesting to exam- ine from any person seeking to cash a check or a draft drawn on such banking organization, for sufficient identification necessary to proper- ly identify such person as the person to whom the check or draft is payable, and that for purposes of this bill, a valid and up to date driver's license, non-driver's identification card, or United States passport shall be deemed to constitute sufficient identification.
Justification
In a period spanning roughly the last decade, banks have devised various fees, of which some are intended by the banks to improve the in-building experience of their own customers. The most notable example of this is the imposition of a fee on non-customers who are cashing checks at a bank, even if the check in question is being drawn from an account at that bank. According to the Los Angeles Times in 2017, Bank of America is among the most recent of banks to increase their fee on non-customers to eight dollars per transaction.
It has been the policy of this State through the banking law to limit, where possible, excessive fees for taking part in simple financial tran- sactions. It does not follow, therefore, that an individual who attempts to draw on an account at a bank for which they have a check should be charged a fee for doing so, even if they are not a customer. This is especially the case since the bank's customer themselves wrote the check to such person. Accordingly, not only does this create an unnecessary financial burden on the person cashing the check, but in some instances it essentially creates a principle of imposing two fees on the same account if the person holding the account also pays an annual account fee.
This bill would make it so that banking organizations can no longer impose a non-customer check cashing fee on checks being drawn from an account at that particular bank, thereby ensuring the State's policy against excessive fees be maintained.
Prior legislative history
S.7973A of 2018, Passed Senate
Fiscal implications
None noted.
Effective date
Immediately
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.