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Poll Central Finds Restrictive Indorsement Policies Not Yet Prevalent

Tuesday, June 26, 2018 ( /

Upcoming changes to Federal Reserve Regulation CC render restrictive indorsements an important part of financial institutions’ RDC risk management strategies. But a recent poll suggests many FIs aren’t ready for the change. New guide aims to help.
Despite upcoming changes in Regulation CC that encourage financial institutions to implement restrictive indorsement policies for RDC transactions, fewer than 60% of FIs participating in a recent Poll Central query require any type of physical indorsements on check deposits. regularly polls visitors on key topics related to RDC. This month we asked “Does your financial institution require checks deposited to have a restrictive indorsement.” Poll participants were offered several response options. As of this writing, 140 responses have been received. Of those, 41% said they require indorsements that state “For [mobile or RDC] deposit only to [My FI], 5% require indorsements that read “For Deposit Only to [My FI],” 1% require “For Mobile Deposit,” and 7% require checks be signed by depositors and include “For Deposit Only.” As the accompanying chart illustrates, 26% of those responding said their FIs have no indorsement requirements, and an additional 9% reported no indorsement requirements as they use virtual indorsements. Six percent of those taking the poll said they did not know what their FI’s indorsement policy was.

The Federal Reserve added an indemnity provision specific to RDC to Regulation CC (the ruleset governing check collections and funds availability) last year, with an effective date of July 1, 2018. The regulatory change stipulates that an FI accepting an RDC item must indemnify any FI that subsequently receives the item as a paper check deposit against losses due to the fact that the item had been paid already. However, the indemnity doesn’t’ apply if the paper check contains a restrictive indorsement, such as “For Mobile Deposit to Bank A.”
While restrictive indorsements are not yet the norm, John Leekley, Founder and CEO of expects that will change. “As more FIs come to understand the implications of restrictive indorsements, and as recognition technologies continue to improve we anticipate more FIs will come to require restrictive indorsements and stipulate the requirement in their customer agreements,” he said.
New Guide Offers Help
One way to advance the restrictive indorsement adoption needle is through industry education. has been contributing to this process, most recently presenting two educational webinars: 67 Days and Counting…Is Your Bank Ready for the July Reg CC Changes and Restrictive Endorsements? and Smarter, Safer Strategies for Adjusting to Upcoming Reg CC Changes. Both webinars  are available for viewing free and on demand. Click here to learn more and to watch.
And this week marks the release of’s Guide to Restrictive Indorsements. This detailed guide addresses the many questions that are being raised in the run-up to July 1. The guide discusses perspectives, considerations, implications and issues for FIs and their customers regarding restrictive indorsements and the new Reg CC language.’s Guide to Restrictive Indorsements is available now for free to members; the cost to non-members is $99.00. Click here now to to order your copy of this timely guide to dealing with the upcoming changes to Reg CC and restrictive indorsements.

Visit Poll Central and Vote is the de facto trade association for the RDC community. Thousands of unique visitors visit each month to learn and exchange ideas about RDC and payments. Poll Central, one of many unique features of, offers insightful intelligence on factors shaping RDC and the marketplace generally.
The Poll Central question featured in this article has been reset and can now be taken again. Results will be published next year. Click here to vote on the featured Poll Central query for July, if you haven’t already. The featured question is: “What are the most important capabilities of an Integrated Receivables Solution?”


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