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Federal Reserve announces policy changes.(Federal Reserve Board)(Brief article)

Business Credit

| May 01, 2006 | COPYRIGHT 2006 National Association of Credit Management. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

The Federal Reserve Board announced the approval of policy changes that seek to reduce the overuse of Federal Reserve Bank cash-processing services by providing incentives for depository institutions to recirculate currency among their customers. It is estimated the cash services policy could affect as many as 225 depository institutions with high-volume currency operations. The changes are intended to reverse a shift by depository institutions away from traditional patterns of currency activity, toward greater reliance on Reserve Bank cash processing. To promote the recirculation of fit Federal Reserve notes by depository institutions, two elements have been added to the existing cash services policy. First, a custodial inventory program will permit ...

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