This bill amends 15 U.S.C. 1693o–2(a)(6) (part of the Electronic Fund Transfer Act) to require automatic inflation adjustments to the statutory dollar amount referenced in subparagraph (A). It inserts a new subparagraph directing the Board of Governors to update that amount using the Consumer Price Index and to perform an initial catch-up adjustment based on a 2009 baseline.
The change is narrowly drafted — it does not rewrite the underlying regulatory framework for payment card transactions but makes the controlling dollar amount fluid rather than fixed. For community banks, credit unions, payment processors, and compliance teams, the result is predictable indexation of a threshold that has previously eroded in real value; for regulators and vendors, it adds an annual calculation and publication task with operational and contractual knock-on effects.
At a Glance
What It Does
The bill inserts a new clause directing the Board to adjust the amount referenced in subparagraph (A) by the annual percentage increase in the Consumer Price Index for the month of October. It requires the Board to make a first adjustment no later than July 1, 2026 and to perform subsequent adjustments by January 15 each year. Before the first annual CPI update, the Board must apply a one-time catch-up change equal to the percent increase from October 2009 to October 2025.
Who It Affects
Entities tied to the EFTA payment-card rules — especially community banks and small issuers near the statutory threshold — plus card networks, acquirers, payments processors, and compliance/legal teams that track statutory triggers. The Board of Governors of the Federal Reserve is the administrating agency with the obligation to calculate and implement the adjustment.
Why It Matters
Indexation prevents gradual erosion of statutory thresholds in real terms and reduces the need for frequent legislative fixes. That changes which institutions may fall above or below the numeric cutoff over time, altering regulatory coverage, operational requirements, and commercial negotiations tied to that dollar amount.
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What This Bill Actually Does
The bill makes a simple but meaningful procedural change: it tells the Federal Reserve Board to annually tie a specific dollar figure in the Electronic Fund Transfer Act to inflation. The statute it amends contains a numeric amount in subparagraph (A); instead of leaving that number frozen, the Board must now update it each year using the October Consumer Price Index (CPI-U).
That keeps the purchasing‑power value of the amount aligned with general inflation.
Mechanically, the text asks the Board to perform two calculations. First, immediately before the first year of annual updates, the Board performs a one‑time ‘‘catch‑up’’ adjustment using the percentage change in the CPI from October 2009 to October 2025.
After that, each year the Board applies the percent change in the October CPI and adjusts the statutory amount accordingly. The statute sets firm dates for those actions, creating an administrative cadence: an initial update by mid‑2026 and yearly updates in January thereafter.The amendment also includes a housekeeping step that renumbers existing subparagraph language.
That technical change matters for statutes and regulations that reference subparagraph letters: cross‑references in existing rules, guidance, or contracts may need to be checked and, in some cases, amended to reflect the renumbering.Operationally, regulators and private parties must build an annual process: the Board must calculate and (implicitly) publish the new amount on the statutory timetable, while banks, processors, and vendors must ingest the new figure and update compliance checklists, eligibility screens, pricing rules, and contract templates. Because the adjustment is formulaic, affected institutions will gain predictability, but they will also need a repeatable workflow to avoid gaps between the Board’s announcement and system implementation.
The Five Things You Need to Know
The bill amends 15 U.S.C. 1693o–2(a)(6) by inserting a new subparagraph (B) that requires inflation adjustments to the amount described in subparagraph (A).
Before the first annual CPI update, the Board must perform a one‑time adjustment equal to the percent change between the October 2009 CPI and the October 2025 CPI.
After the catch‑up, the Board must adjust the amount annually using the annual percentage increase in the Consumer Price Index for October.
Statutory deadlines in the text require the Board to complete the first adjustment not later than July 1, 2026 and to perform each subsequent adjustment by January 15 of each year.
The bill redesignates the preexisting subparagraph (B) as subparagraph (C), a technical renumbering that can affect cross‑references in rules and contracts.
Section-by-Section Breakdown
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Short title — 'Community Bank Relief Act'
A one-line provision that gives the bill its public name. It carries no operative effect on substance but signals the legislative intent and the beneficiary group the sponsor highlights.
Technical renumbering of existing subparagraph
The bill first redesignates the existing subparagraph (B) as subparagraph (C). This is a non‑substantive change in lettering but creates a new slot for the inflation‑index rule and means anyone relying on the current statutory lettering will need to verify downstream citations in regulations, guidance, vendor contracts, and policies.
Annual CPI-based adjustment mechanism
The new clause (i) requires the Board to update the amount described in subparagraph (A) each year using the annual percentage increase in the Consumer Price Index for October. The provision establishes a repeating, formulaic mechanism rather than periodic ad hoc legislative or rulemaking changes, which streamlines maintenance of the dollar figure but transfers the operational work to the Board and affected institutions.
One-time catch-up adjustment (2009 baseline)
Before the first routine CPI-based adjustment, the Board must make an initial adjustment equal to the percentage difference between the October 2025 CPI and the October 2009 CPI. That provision creates an immediate upward calibration of the statutory amount to correct for cumulative inflation since 2009, producing a discrete change that stakeholders must plan for in addition to the ongoing annual indexing.
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Explore Finance in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Community banks and small issuers — The indexation preserves the real value of the statutory dollar amount over time, which prevents gradual erosion that can extend coverage or obligations to institutions that the original threshold did not intend to capture.
- Compliance and legal teams at affected institutions — Annual, formulaic adjustments reduce uncertainty and the need to track ad hoc statutory updates; teams can schedule predictable update cycles rather than scramble for one‑off changes.
- Payments processors and vendors offering compliance tools — Predictable, date‑driven changes allow vendors to bake annual update feeds into product roadmaps and offer subscription updates tied to the Board’s publication schedule.
- Regulatory planners at the Federal Reserve — The Board gains a clear statutory mandate and timetable for making the adjustment, removing discretionary timing questions.
Who Bears the Cost
- The Board of Governors of the Federal Reserve — The statute imposes an annual administrative obligation (calculation and likely publication) without appropriating additional resources, creating a recurring operational task.
- Banks and payment service providers — Integrating an annually changing statutory figure into systems, contracts, pricing rules, and eligibility logic will require recurring compliance work and potential IT updates.
- Vendors and third‑party processors serving small institutions — They must maintain update pipelines and may face increased support burdens around each January publication and the one‑time catch‑up.
- Counsel and contracting teams — The initial catch‑up could trigger renegotiation points in contracts and commercial agreements that reference the statutory amount, producing transactional and legal costs.
Key Issues
The Core Tension
The central dilemma is between preserving a statutory threshold’s purchasing‑power (and thus protecting the intended scope of coverage) and removing legislative discretion over that number. Indexation prevents erosion and adds predictability, but it also locks in a technical rule that can produce abrupt, consequential shifts (especially via a retroactive catch‑up) and substitutes an administrative process for policy judgment.
The bill solves a common problem — static dollar thresholds losing real value — by delegating a numerical update to an established inflation measure. That simplicity masks several implementation questions left unresolved in the text.
The statute specifies the CPI month (October) and the timing for adjustments, but it does not address rounding conventions, whether the Board must publish a Federal Register notice or other formal announcement, or how quickly private parties must implement the new number after the Board’s calculation. Those operational gaps matter because they determine short windows for IT changes, contractual triggers, and enforcement timelines.
The one‑time catch‑up feature is the most consequential political and economic element. A jump indexed from 2009 to 2025 corrects long‑standing erosion, but it can produce a discrete reallocation of regulatory coverage overnight, creating winners and losers who had planned around the static number.
The bill also ties the statutory figure to general inflation as measured by the CPI, which reflects consumer prices broadly but may not correlate with costs specific to payment processing or the banking sector; indexation to a different measure (wage or sector price indices) would produce different outcomes. Finally, the delegation to the Board without procedural detail reduces legislative burden but transfers discretion over publication mechanics and timing — the Board will need to operationalize the statute in a way that minimizes market disruption.
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