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New requirements for live checks now effective in New York


On September 2, 2022, new requirements for “live checks” became effective in New York.  The new requirements were created by SB 4894 which New York Governor Hochul signed into law on May 5, 2022.

The new requirements apply to “mail-loan checks” issued by “lending institutions.”  A “mail-loan check” is defined as “a check, made out to and mailed to a person by a lending institution, which, when cashed or deposited by such person, obligates such person to repay to such lending institution the amount of the proceeds of such check according to terms mailed to such recipient with such check.”  A “lending institution” is defined as “a licensed lender or a state or federally chartered bank, trust company, savings bank, savings and loan association or credit union.”  A “licensed lender” is a lender licensed by the New York Banking Superintendent.  These definitions create uncertainty as to whether the law is limited to checks sent by lending institutions to New York residents or whether it also applies to checks sent by New York lending institutions to residents of other states.

The new requirements include the following:

  • A mail-loan check can only be issued in response to a request or application for a check.
  • For a mail-loan check issued to a non-customer, the following written statement must appear on the face of the check: “One form of valid photographic ID needed to cash or deposit.” (An entity cashing or accepting a mail-loan check for deposit is permitted to require more than one form of identification.)
  • For any mail-loan check, the check must show the transaction fee and interest rate and any other information required by the Superintendent.

In addition to New York, 23 other states currently have statutes or regulations governing live checks.  


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