- Federal law prohibits interest on demand deposits. To implement this prohibition for member
banks, restrictions on transfers and withdrawals from deposits are set forth in Regulation D.
- By law, the FDIC must make such exceptions to the statutory prohibition against the payment of
interest on demand deposits with respect to state nonmember banks and insured branches of
foreign banks as are prescribed by Federal Reserve Board regulation for member banks.
- Regulation D previously excluded from the definition of a "demand deposit" accounts that permit
no more than six transfers per four-week period with a sublimit of not more than three transfers
per month by check, debit card or other drafts to third parties.
- Regulation D was recently amended by the Federal Reserve Board to increase from three to six the
permissible monthly number of transfers or withdrawals from savings deposits by check, debit
card or other drafts to third parties.
- The elimination of the three transfer sublimit was effective for FDIC-supervised institutions on
July 2, 2009, the effective date of the amendment to Regulation D.
- The FDIC has amended Part 329 of its regulations to reflect this change.
Interest on Deposits
12 C.F.R. Part 329
Final Rule - PDF (PDF Help)
Samuel Frumkin, Senior Policy Analyst, at (202) 898-6602
or email@example.com, or Mark Mellon, Counsel, at (202)
898-3884 or firstname.lastname@example.org
FDIC financial institution letters (FILs) may be accessed
from the FDIC's Web site at
To receive FILs electronically, visit
Paper copies of FDIC financial institution letters may be
obtained via the FDIC's Public Information Center (1-877-
275-3342 or 703-562-2200).