On April 28, 2020, the Federal Reserve Board (FRB) published an interim final rule that amends Regulation D to aid consumers with cash flow, due to the COVID-19 pandemic. Specifically, the FRB has eliminated the six-per-month limit on “convenient” transfers from the definition of “savings deposit” in Regulation D (12 C.F.R. § 204.2(d)), permitting—but not requiring—depository institutions to suspend enforcement of the limit and immediately allow customers to make an unlimited number of transfers and withdrawals from their savings accounts or money market accounts. The interim final rule also permits depository institutions to suspend enforcement on a temporary basis.

Under Regulation D, convenient transfers and withdrawals include transfers to another account of the depositor at the same institution or to a third party by means of preauthorized or automatic transfers, telephone or online transfers, or check or debit card. See 12 C.F.R. § 204.2(d)(2).

The FRB said in a press release that, because of its recent reduction of reserve requirement ratios to zero percent for transaction accounts, the transfer limit distinguishing between reservable transaction accounts and non-reservable savings deposits is no longer necessary. In addition, the FRB said that “financial events associated with the coronavirus pandemic” have made consumers’ remote access to funds in savings accounts “more urgent.”

The FRB’s Federal Register notice includes responses to a series of FAQs on this topic, and the FRB solicits comment on the interim final rule and, in particular, on considerations that cause depository institutions to retain a numeric limit on the number of convenient transfers that may be made each month from a savings deposit.

The interim final rule became effective upon issuance on April 24, 2020, and comments are due by June 29, 2020.

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