Regulation E provisional credit is the temporary refund your bank must post to your account when it needs more than 10 business days to investigate a disputed electronic fund transfer. The credit equals the full disputed amount, including any interest owed, and you get unrestricted use of the money while the investigation continues. It applies to debit card charges, ATM withdrawals, direct deposits, peer-to-peer transfers, and most other electronic movements from a consumer account.
When Provisional Credit Kicks In
The bank has 10 business days from receiving your error notice to investigate and correct any error it confirms.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors Most disputes cannot be wrapped up in that window, which is exactly why the provisional credit rule exists.
Once the institution decides to extend its investigation past 10 business days, it must provisionally credit your account for the full alleged error amount, plus applicable interest. The credit has to post within 10 business days of the date the institution received your notice, and you get unrestricted access to the funds throughout the investigation.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
Within two business days after applying the credit, the institution must tell you the amount and the date it was posted.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
Two Situations Where You Do Not Get Provisional Credit
The obligation drops in two scenarios.
The first is a written-confirmation failure. When you report an error by phone, the bank can require you to send a written and signed statement within 10 business days. If it imposes that requirement, it must tell you so during the call and give you the mailing address. Miss the 10-day deadline and the institution no longer has to provisionally credit your account, though the investigation itself must still proceed.2Consumer Financial Protection Bureau. 12 CFR 1005.11 – Procedures for Resolving Errors
The second is new accounts. For errors involving transfers within the first 30 days after the initial deposit, the institution has 20 business days instead of 10 before the provisional credit obligation begins.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
Investigation Deadlines That Cap the Credit Period
Provisional credit is temporary by design. It sits in your account only until the investigation ends, and the regulation sets outer limits on how long that can take.
45 Calendar Days: The Standard Extension
When the institution cannot finish within 10 business days, it can extend the investigation to 45 calendar days from receipt of your notice. Provisional credit must be in your account during that period.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
90 Calendar Days for Certain Transfers
Three transaction types get a longer window. The institution has up to 90 calendar days when the disputed transfer was not initiated within a state, resulted from a point-of-sale debit card transaction, or occurred within 30 days of the first deposit to a new account.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors Point-of-sale debit disputes are the most common 90-day case because they usually require coordination with merchants and payment networks.
What You Have to Do to Trigger It
You have 60 days after the institution sends the periodic statement reflecting the error to report it. The clock starts when the statement is sent, not when you open it.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
Your notice needs to identify you and your account and explain why you believe an error occurred. Include the date, type, and dollar amount if you can, though the regulation only requires this “to the extent possible.”1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors A phone call is enough to start the timeline.
If the bank asks for written confirmation of your oral report, send it within 10 business days. The investigation continues either way, but skipping the letter eliminates your right to provisional credit while the bank works. Send the follow-up even when the phone agent tells you it’s optional; get the mailing address in writing if you can.
What Happens When the Investigation Ends
The institution has three business days after completing its investigation to report findings to you. If it confirms an error, it must correct it within one business day, which includes making the provisional credit permanent and refunding any fees the institution charged as a result of the error, including overdraft fees caused by an unauthorized debit. Fees that would have been charged regardless of the error do not have to be refunded.2Consumer Financial Protection Bureau. 12 CFR 1005.11 – Procedures for Resolving Errors
When the Bank Finds No Error
If the investigation concludes that no error occurred, or that the error was for a different amount than you reported, the institution must send a written explanation. That explanation must tell you that you can request copies of the documents the bank relied on, and the bank must promptly provide them if you ask.3eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors Requesting the documents is worth doing if you plan to push the dispute further, since they show what the bank actually looked at.
Reversing the Provisional Credit
When the bank finds no error, it can debit the provisional credit back out of your account. It must notify you of the date and amount of the debit. For five business days after that notice, the institution must honor checks, preauthorized payments, and similar transactions from the account without charging overdraft fees.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors After that five-day cushion, normal overdraft charges can resume if the account is still negative.2Consumer Financial Protection Bureau. 12 CFR 1005.11 – Procedures for Resolving Errors
What Reg E Will Not Cover
Provisional credit only applies to disputes that qualify as Reg E errors. Several common transaction types fall outside that scope, and filing under the wrong framework can leave you without the remedies you expected.
Credit card disputes run under Regulation Z, not Reg E. Wire transfers through Fedwire, CHIPS, and SWIFT are excluded from Reg E’s definition of electronic fund transfer.4eCFR. 12 CFR Part 1005 – Electronic Fund Transfers (Regulation E) Merchant-quality complaints on debit cards, such as a product that arrived broken, never showed up, or did not match the description, generally do not qualify as errors. The regulation covers unauthorized and incorrect transfers, not buyer’s remorse. A double charge or a charge for the wrong amount does qualify.1eCFR. 12 CFR 1005.11 – Procedures for Resolving Errors
Peer-to-peer payments through apps like Zelle, Venmo, and Cash App sit inside Reg E when they meet the definition of an electronic fund transfer from a consumer account. Unauthorized access to your account is covered. A transfer you sent yourself to the wrong person, or authorized in exchange for goods that never arrived, generally is not, because you authorized the transfer.
If the Bank Does Not Follow the Rules
A consumer who sues over a Reg E violation can recover actual damages plus statutory damages between $100 and $1,000, along with attorney’s fees and court costs. Class actions allow recovery up to the lesser of $500,000 or 1% of the institution’s net worth.5Office of the Law Revision Counsel. 15 USC 1693m – Civil Liability
Penalties escalate when an institution both fails to issue provisional credit within the required 10-day window and either did not investigate in good faith or had no reasonable basis for concluding the account was not in error. In that situation, the consumer is entitled to treble damages, tripling the statutory award. The same treble damages apply when an institution knowingly and willfully concluded no error occurred despite evidence to the contrary.6Office of the Law Revision Counsel. 15 USC 1693f – Error Resolution