National Check Professional (NCP) Certification Practice Test

What does Reg CC define?

1. A check

2. A customer transaction

3. Electronic fund transfers

4. A loan agreement

The correct answer is: A check

Regulation CC primarily deals with the availability of funds and the collection of checks. It establishes the rules surrounding the hold and availability of deposited checks, and as part of that, it provides definitions and guidelines regarding what constitutes a check. This includes details on how checks are processed and what consumers can expect regarding the timing of funds availability. Therefore, defining a check correctly aligns with the scope and purpose of Reg CC, making it the most relevant choice in this context. In contrast, while a customer transaction, electronic fund transfers, and loan agreements are important elements within banking and financial regulations, they fall outside the specific purview of Regulation CC. The regulation focuses narrowly on the handling of checks rather than the broader categories of financial activity that the other options represent.