Understanding Reg D

What is Reg D?

Regulation D limits the number of certain types of transactions on all savings and money market accounts. In other words, all financial institutions are required by regulation to treat all types of transactions differently than a checking account. Savings accounts (non-transaction accounts) are intended to be established for long-term savings with few withdrawals while checking accounts (transaction accounts) are intended to be established for day-to-day use. Checking accounts do not fall under Reg D and there is no monthly limit to automated transfers or withdrawals on them, so this notice does not apply to checking accounts.

Each Southeast Financial savings or money market account is allowed no more than six (6) “Reg D” withdrawals per calendar month from a savings/money market account.
What accounts are affected by Reg D?
  • Primary Membership Savings Accounts
  • Secondary Savings Accounts
  • Money Market Accounts
  • Christmas Club Accounts
What transactions are subject to Reg D?
  • Point of Sale (POS) debit card transactions: Transactions made from a savings account using a debit card at a retail merchant.
  • Audio Response (PAL) Transfers or Online Banking Transfers: Transfers from a savings account to another savings or checking account using PAL or Online Banking.
  • Overdraft Protection: Transfers made from a savings account to a checking account to cover an item, such as a check, pre-authorized debit, or a transaction initiated at an ATM or POS.
  • ACH Debits: A pre-authorized payment from a savings account to pay a third-party item (i.e. auto insurance, electric bill).
  • Employee Assisted Transfers: A phone request by a member to any of our employees to perform a transfer transaction from a savings account.
What transactions are not affected by Reg D?
  • Deposits
  • ATM cash withdrawals & transfers
  • In-person withdrawals & transfers
  • Any transaction from a checking account which does not necessitate an overdraft transfer from a savings account
  • Transfers to make Southeast Financial loan payments
  • Overdraft protection for a checking account made from a line of credit
  • Withdrawal or transfer requests made by mail if made payable to and mailed to the member
What happens when the Reg D limit is reached for the month?
  • Point of Sale (POS) debit card transactions: Additional authorization requests will be rejected.
  • Audio Response (PAL) Transfers or Online Banking Transfers: Your request will be rejected.
  • Overdraft Protection: Funds will not be automatically transferred from your savings account to pay an item if there are insufficient funds in your checking account to cover the amount of the item. Your item will be returned unpaid and an NSF fee will be charged to your account.
  • ACH Debits: Your ACH debit will be returned unpaid and an NSF fee will be charged to your account.
  • Employee Assisted Transfers: You will be informed that your limit has been reached and your request cannot be processed at that time.
How can I manage my accounts to avoid Reg D limits?

There are several ways to manage your account such as:

  • Open a Checking Account (some restrictions may apply).
  • Have your direct deposits sent to your checking account, which is not subject to Reg D. You can make unlimited transactions from your checking account.
  • Arrange for all ACH withdrawals and pre-authorized debits to come out of your checking account instead of a savings account.
  • Plan ahead and make one large transfer from your savings account instead of several small transfers.

Don’t have a Southeast Financial checking account? Learn more about our checking accounts, then visit any branch or call us at 615-743-3700 or 800-521-9653 to apply.

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