FedCash Services®: Adjustments applied to your institution’s cross-shipping fees
October 1, 2020
FedCash Services customers will receive a cross-shipping fee adjustment for third quarter fees in their November Statement of Service Charges.
As a contingency measure due to COVID-19, the Federal Reserve temporarily modified its fitness criteria for all currency denominations in March 2020. This measure was applied to reduce the number of notes shredded and increase the volume of fit currency to meet the heightened demand. Federal Reserve Banks will continue to apply these relaxed fitness criteria as long as normal currency demand patterns remain disrupted by the pandemic.
The relaxation of fitness criteria causes institutions with cross-shipping activity above the de minimis exemption to be assessed higher cross-shipping fees than they would be under normal fitness standards. As communicated in early July, in August the Federal Reserve applied an adjustment to offset any higher-than-normal fees incurred in first and second quarter as a result of the relaxed fitness criteria. In November, the Federal Reserve will again apply a cross-shipping adjustment to offset any higher-than-normal fees incurred in the third quarter as a result of the relaxed fitness criteria. An information sheet on the Recirculation Policy and how cross-shipping fees are calculated (PDF) can be found here.
Cross-shipping adjustments for third quarter will be applied to your November Statement of Service Charges – one month after the third quarter cross-shipping billing posts on the October Statement of Service Charges. As a result, any additional cross-shipping fees that you pay in October will be deducted from the service charges your institution incurs for the month of November.
Adjustments will capture the difference between the actual billed amount for cross-shipping volume for third quarter of 2020 and what would have hypothetically been billed had the fitness criteria not been relaxed. The adjustments will be applied by zone with the difference in cross-shipping fees subtracted from your institution’s November Statement of Service Charges.
The Federal Reserve will continue to issue cross-shipping adjustments to impacted institutions for quarters in which currency processing of covered denomination is subject to relaxed fitness criteria. However, this will be the last communication to announce these fee adjustments. Going forward, the Federal Reserve will issue the adjustment every quarter, and we will notify you when the contingency measure is disabled.
If you have questions or need more specific information, please contact your local Federal Reserve Office Cash Services Department.