Regulation D in Banking: Withdrawal Limits, Fees, and Disclosures

Regulation D is a Federal Reserve rule on how banks and credit unions classify deposit accounts and hold reserves against them. For years, the part of it that touched ordinary customers was the six-withdrawal cap on savings and money market deposit accounts. The Federal Reserve deleted that cap from the regulation on April 24, 2020, and as of 2026 reserve requirement ratios remain at zero percent on every deposit category.¹² The rule change lets banks drop the limit but does not force them to. Some have; some still enforce their own version through internal policy.

Why the Six-Withdrawal Rule Existed

Regulation D implements the Federal Reserve’s reserve requirement authority. Banks historically had to hold a share of certain deposits in reserve rather than lending them out, and the regulation tells institutions how to classify accounts for that purpose.³

Checking accounts, called demand deposits under the rule, carried reserve requirements. Savings accounts and money market deposit accounts did not. To keep the two categories distinct, the Fed capped “convenient” transfers out of savings accounts at six per statement cycle. If a savings account behaved like a checking account, the classification and the reserve math both broke down.

Transfers that counted toward the six included online and mobile transfers, automatic and preauthorized transfers such as recurring bill payments and overdraft protection, phone and fax requests, ACH payments, and checks or debit card payments drawn on an MMDA. Transactions that did not count included in-person withdrawals at a branch, ATM withdrawals, and withdrawals requested by mail.⁴ Showing up in person or waiting for the mail did not look like checking-account behavior, so it stayed off the count.

Why the Fed Removed the Limit

Effective March 26, 2020, the Federal Reserve reduced reserve requirement ratios to zero percent on all net transaction accounts. A month later, on April 24, 2020, it announced an interim final rule deleting the six-transfer cap from the savings deposit definition, effective immediately.¹

The reasoning followed from the reserve change. The cap existed to keep savings accounts out of the transaction-account bucket for reserve purposes. Once every bucket carried the same zero percent requirement, the distinction stopped doing regulatory work.⁴

Where the Rule Stands in 2026

The six-transaction language is gone from the regulatory text, not merely paused. The current definition of “savings deposit” in 12 CFR 204.2(d) says a depositor may make transfers and withdrawals “regardless of the number of such transfers and withdrawals or the manner in which such transfers and withdrawals are made.”⁵

Reserve requirement ratios remain at zero percent for 2026 across all deposit categories. A Federal Register notice published November 24, 2025 confirmed that statutory indexation of certain exemption thresholds still occurs annually but has no practical effect while the underlying requirement sits at zero.²

The deletion applies to savings deposits generally. The Fed’s announcement referred to “savings deposits” and “customers” without distinguishing personal from business accounts, so business savings accounts are covered on the same terms.¹

Your Bank Can Still Set Its Own Limit

This is the part that trips people up. The federal change permits banks to drop the cap; it does not require it. The Fed’s own guidance on the rule change was explicit on that point.⁴ Many large banks and online-only banks have eliminated transaction caps on savings accounts. Others still enforce a monthly limit, sometimes six, sometimes a different threshold, as internal policy.

Reasons vary. Some banks want to discourage customers from running a high-yield savings account like a checking account, because the way those deposits are used affects how the bank can lend them. Others simply have not rewritten their deposit agreements.

The practical step is to check your bank’s current deposit agreement or call and ask two questions. Does your savings account or MMDA have a monthly transaction limit? What happens if you go over it? The answers can differ not just between banks but between account tiers at the same bank.

What Happens If You Exceed a Bank’s Limit

Where a bank still enforces a cap, the consequences look much like they did under the old federal rule. Many banks charge a fee for each transaction beyond the sixth. Amounts are set by the bank; historically they have ranged from nothing up to around $15 per excess transaction.

Repeated excesses can trigger reclassification. Under the old federal framework, a bank that saw a customer regularly break the cap had to convert the savings account into a checking account or remove its electronic transfer features.⁴ Where banks still run their own version of the limit, reclassification usually means losing the savings rate and sometimes picking up a monthly maintenance fee.

How Limits and Fees Must Be Disclosed

Whatever a bank chooses to do with transaction limits, the Truth in Savings Act (Regulation DD) governs how it must tell you. When you open an account, the bank must clearly disclose any limits on the number of withdrawals and any fees tied to them.⁶

If your bank later adds a transaction limit or raises a withdrawal fee, it must mail or deliver written notice at least 30 calendar days before the change takes effect.⁶ Fees actually charged must be itemized on your periodic statement by type and dollar amount. If your account is reclassified from savings to checking because of excessive transactions, that change in terms and any resulting change in interest rate or fees must also be disclosed.

Account Types Covered by Regulation D

Regulation D sorts deposit accounts into three categories, and it helps to know which one you have when you ask your bank about limits.

Demand deposits are standard checking accounts. Money is available immediately with no waiting period or notice requirement.⁵

Savings deposits and money market deposit accounts are meant for holding money. To qualify for the classification, the bank must reserve the right to require at least seven days’ written notice before a withdrawal.⁵ Banks almost never actually enforce that waiting period, but keeping the contractual right is what separates the account from checking. This is the category that once carried the six-transaction cap.

Time deposits, most commonly certificates of deposit, lock the money away for at least seven days, with a mandatory penalty of at least seven days’ simple interest for early withdrawal.³ The early withdrawal penalty made a transaction cap unnecessary for CDs, so they were never subject to the six-withdrawal rule.

One boundary worth flagging: a money market deposit account (MMDA) at a bank is not the same product as a money market mutual fund at a brokerage. An MMDA is a bank deposit, FDIC-insured up to $250,000 per depositor, and covered by Regulation D. A money market fund is an investment, not FDIC-insured, not covered by Regulation D, and not subject to bank transaction limits. Everything above applies only to the bank version.

1
Board of Governors of the Federal Reserve System. Federal Reserve Board Announces Interim Final Rule to Delete the Six-Per-Month Limit on Convenient Transfers From the Savings Deposit Definition in Regulation D
2
Federal Register. Regulation D – Reserve Requirements of Depository Institutions
3
eCFR. 12 CFR Part 204 – Reserve Requirements of Depository Institutions (Regulation D)
4
Federal Register. Regulation D – Reserve Requirements of Depository Institutions
5
eCFR. 12 CFR 204.2 – Definitions
6
eCFR. 12 CFR Part 1030 – Truth in Savings (Regulation DD)