We're having problems with clients telling us a refund check was not received, reissuing, & then cashing both checks. Is there any business reason we couldn't make our refunds expire in 30 days rather than 90/180 days?

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We are not aware of any banking regulation that requires a certain minimum period of time to stale date a check. However, we encourage you to check with your bank. From a business perspective it may depend upon how quickly the checks are released into the mail after they are printed, also giving consideration to mail float. If you mail a check on the date it was processed, then you may do some analysis regarding the mail float to different geographic regions of the country to see what would be the greatest period of mail float time from your processing center. This would give you an idea when the payee would receive the check and the number of days that they would have to cash it. In general the payee should have the incentive to cash the check quickly.

A business policy to wait until after the stale date period for the original check has passed to stop payment and re-issue a check is a sound practice. The customer may not be pleased but if they are not attempting to cash it twice, then they would understand this policy. Those customers who would complain about it may be the ones trying this tactic to get more money. In this case it will again depend upon management's philosophy as to how long do they feel is reasonable to allow a check to be valid. Using 30 days does not seem unreasonable for a refund check but we suggest you look at some of the analysis noted in the paragraph above to see if 30, 45, 50, or 60 etc. would be reasonable.

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