Is there a Federal limit to the number of withdrawals from a savings account?

Question

I discovered a service charge from Chase Bank, which was explained to us as a Federal regulation rather than a regulation imposed by Chase. Is this true? Where can I verify this? I obviously cannot ask the bank because I am not sure they are telling me the truth!

Answer 1

Regulation D: Savings Account Transaction Limitations

Federal regulations require banks to limit the way withdrawals may be made from a savings or money market deposit account. Withdrawals in excess of these limits may result in a fee or account closure.

Customers sometimes wonder why bank accounts have different terms or pay different interest rates. One of the reasons is Regulation D:

Regulation D applies to all financial institutions.

It imposes uniform reserve requirements on transaction accounts or non-personal time deposits, defines such deposits, and requires reports to the Federal Reserve.

The regulation establishes operating parameters for each account category, such as transaction accounts (demand deposit or checking accounts) and non-transaction savings accounts. For instance, this regulation currently prohibits the payment of interest on business checking accounts.

Regulation D also places limits on the type and number of withdrawals that can be made from certain non-transaction accounts, such as savings and money market deposit accounts.

Checking accounts are deemed to be "transaction accounts", and have no such transfer or withdrawal limitations.

What accounts does it affect and how?

Savings Accounts and Money Market Deposit Accounts: During any month, you may not make more than six withdrawals or transfers to another bank account of yours or to a third party by means of a pre-authorized or automatic transfer or telephonic order or instruction. No more than three of the six transfers may be made by check, draft, debit card, if applicable, or similar order to a third party.


To help you understand these Reg. D savings account transaction limitations, and to avoid excess activity charges, please review the following information:

Non-Limited Transactions:

Deposits


ATM cash withdrawals and transfers (subject to the daily amount limits and sufficient available funds)


Withdrawals made in person, by mail, or by messenger at a bank office


Transfers made in person at a bank office


Automatic transfers to repay your bank loan




Limited Transactions:
Checks, point-of-sale (POS) transactions, or debit card purchases (a maximum of three during each monthly statement period)

Automatic transfers to another deposit account at your bank

Automatic transfers to a third party or another institution

Telephone transfers, including Touch-Tone-Teller and those initiated by phone call, fax or e-mail through a Bank representative

HomeAccess online banking transfers and Bill Payments


In order to ensure that no more than the permitted number of withdrawals or transfers are made, the regulation requires that depository institutions take steps to prevent excessive transactions.

Excessive Transactions: Withdrawals or transfers by mail, in person at one of our offices, and through an ATM are unlimited and are not subject to the Regulation D 6-transfer withdrawal limitation. Transfers/withdrawals in excess of the 6-transfer/withdrawal limitations as described above may be subject to a service charge.

For customers who continue to violate those limits after they have been contacted by the depository institution, the Regulation requires that either the account be closed or that the funds be transferred to a transaction account that the depositor is eligible to maintain.


FDIC Insured - Your deposits are federally insured to at least $100,000 per depositor by the Federal Deposit Insurance Corporation (FDIC), and your retirement funds on deposit at Pacific Trust Bank are separately insured by the FDIC up to an additional $250,000.

Answer 2

There is a limit of 6 drafts from any money market fund that is FDIC insured (per month). It is the law!

Do you really think a bank like Chase would lie to you about this?
Wrong information from a bank is usually from ignorance, not twisting the truth about federal regulations.

Answer 3

Each bank draws up its own rules for different customers and accounts. I have never been offered a savings account that allows me to deposit money only a few times per period, but I would not pass it by any bank to establish such a rule. Why would a bank do that? - It costs a little money to process your payment. That is how a bank justifies the restriction. But the ultimate reason is that a bank tries to make money every way possible. If they can slip in unusual fees and you incur them unknowingly, they will do that. And yes. Such a rule would penalize people who are trying to save as often and as much as possible.

Answer 4

I have never heard of that. When i withdrew money from my savings account i was never charged a service fee. The only time i was charged a fee if it was below a limit. but as far as i know there is no limit to a number of withdrawls from a savings account. if i were u i would change banks. but before u do ask them about any hidden charges. some banks will charge what ever they like for that is how they make their money. check out other banks first and if u like their answeres then change ur bank.

Answer 5

Banks will always charge fees to recoup any losses in withdrawals, etc.

As far as it being a Federal regulation, I would enquire at another bank to find out.

Answer 6

In fact, if you persist in making numerous w/drawals from a savings account - the bank, by law, will close the account and send you a check......

they are telling you the truth......The service fee is suspect, but the account category is regulated by federal banking laws.

Answer 7

Reg D Excessive Transactions

Answer 8

The money in the saving account is your money. They probably cannot limit you from withdrawing it but they can charge for the service.

Answer 9

I've never heard of it. I have heard of daily limit withdraws from the bank.

Answer 10

I just now found this out. They never limited me before until this month. The credit union said that they were just updated and now that is how its gona be.