Reg D transfer limit should be temporarily or permanently eliminated

March 18, 2020

The Federal Reserve Board should eliminate, either temporarily or permanently, the Regulation D transfer limit, CUNA wrote to the Fed Tuesday, due to the unprecedented challenges caused by the coronavirus (COVID-19).

“CUNA is confident that our members will be able to deliver necessary financial services to credit union members throughout the pandemic. The Board has taken several steps since the start of crisis to boost the economy and to ensure that the system has adequate liquidity, but most of these efforts do not provide help for individual challenges facing consumers,” the letter reads. “Providing relief from the Regulation D transfer limit would make it easier for credit unions to give members access to their funds.”

Regulation D limits on the number of transfers or withdrawals consumers—including credit union members—can make from their savings accounts to six per month. CUNA has previously called for the Fed to permanently raise the transfer limit.

“As credit unions and other financial institutions take steps to protect employees and consumers’ health through the delivery of financial services by electronic means, Regulation D becomes an even larger barrier to the smooth and seamless delivery of financial services,” the letter reads. “With federal, state and local governments urging Americans to stay home and limit contact with others, making transfers by phone or through mobile banking applications is the safest way to access funds and yet these methods count against the transfer limit. Penalizing Americans being asked to stay home for conducting banking transactions in the safest manner is poor public policy and should be changed immediately.

“We believe such threshold is arbitrary, antiquated, unnecessary and now possibly a barrier to consumers accessing their funds from home. We urge the Board to make a change soon to make it easier for Americans to access their funds,” it adds.