Fed sets payment services fee schedules

Fee schedules for Federal Reserve Bank payment services for depository institutions have been approved by the Federal Reserve Board. The fees are effective Jan. 3, 2006.

The Reserve Banks project that they will recover 102.5 percent of all their priced services costs in 2006 and estimate that they will recover 103.6 percent of these costs in 2005.

Overall, die price level for Federal Reserve priced services will increase about 3 percent in 2006 from 2005. This increase, the Fed said, reflects an approximately 5 percent rise in paper check service fees combined with a 1 percent decrease in fees for the Reserve Banks' electronic payment services. Fee schedules for all priced services are available on the Federal Reserve Banks' financial services Web site at www.frbservices.org.

In addition, the Fed approved the 2006 private-sector adjustment factor for Reserve Bank priced services of $117.7 million. The PSAF is an allowance for income taxes and other imputed expenses that would have to be paid and profits that would have to be earned if the Reserve Banks' priced services were provided by a private business. The Monetary Control Act of 1980 requires that die Federal Reserve establish fees to recover the costs of providing priced services, including the PSAF, over the long run, to promote competition between the Reserve Banks and private-sector service providers.