Banks and other depository institutions may allow their customers to make an unlimited number of convenient transfers and withdrawals from savings accounts following action by the Federal Reserve Friday.
In a release, the Fed said that it had deleted the six-per-month limit on convenient transfers from the definition of “savings deposit,” which allows customers and members to make the unlimited numbers of transfers and withdrawals “at a time when financial events associated with the coronavirus pandemic have made such access more urgent.”
The regulator issued an interim final rule to amend its Regulation D (Reserve Requirements of Depository Institutions) in order to make the change. In a release, the Fed noted that the regulatory limit in Regulation D was the basis for distinguishing between reservable “transaction accounts” and non-reservable “savings deposits.”
“The Board’s recent action reducing all reserve requirement ratios to zero has rendered this regulatory distinction unnecessary,” the agency said.
The Fed also said it is taking public comments on the action; those will be due 60 days after the interim final rule is published in the Federal Register.