Understanding Federal Reserve Regulation D: Withdrawal Limits and Updates

Thomas J Catalano is a Certified Financial Planner (CFP) and Registered Investment Adviser based in South Carolina, where he established his financial advisory firm in 2018. His expertise spans investments, retirement planning, insurance, and comprehensive financial strategies.

What Is Federal Reserve Regulation D?

Federal Reserve Regulation D is a key rule designed to ensure banks and credit unions maintain adequate cash reserves by setting guidelines for savings and money market accounts.

In 2020, the Federal Reserve revised its approach by eliminating reserve requirements for financial institutions and lifting restrictions on consumer savings withdrawals. Although the rule was suspended, banks and credit unions retained the option to enforce monthly transaction limits.

Key Highlights

• Regulation D established reserve requirements for banks and credit unions.
• It limited the number of withdrawals or transfers from savings and money market accounts.
• Financial institutions are no longer mandated to enforce these limits.
• Some institutions continue to apply the six-transaction monthly cap, while others have removed it.

How Did Regulation D Function?

Regulation D was implemented as a monetary policy tool by the Federal Reserve.

It restricted certain types of withdrawals and transfers from savings accounts to maintain sufficient reserves. The rule targeted "convenient" transactions such as bill payments, check writing, debit card usage, overdraft transfers, and transfers via phone, fax, or online.

Transactions like in-branch withdrawals, ATM withdrawals, and bank-issued checks were exempt from the monthly limits.

The regulation applied exclusively to savings-related accounts, excluding checking accounts, which are designed for frequent transactions like bill payments and purchases.

Important Note

Federal Reserve Regulation D should not be confused with SEC Regulation D, which pertains to private placement exemptions.

Recent Changes to Regulation D

In April 2020, the Federal Reserve suspended the enforcement of transaction limits to adopt a new reserve strategy and to provide consumers with easier access to their funds amid the COVID-19 pandemic and its economic effects. However, this suspension did not prevent financial institutions from maintaining their own withdrawal limits, and some continue to do so.

Transactions Subject to Limits

The following transaction types for savings and money market accounts were limited under Regulation D:

• Online transfers
• Phone or fax transfers
• Overdraft transfers to checking accounts
• Debit card transactions
• Check transactions
• Automated transfers including recurring withdrawals and bill payments

Is Regulation D Still Suspended?

As of May 3, 2025, Regulation D remains suspended. This suspension is expected to continue as part of the Federal Reserve’s strategy to maintain ample liquidity in the financial system.

What Were the Requirements of Regulation D?

Prior to suspension, Regulation D required banks to limit withdrawals and transfers from savings and money market accounts to six per month to support monetary policy implementation.

Can I Withdraw $20,000 From a Bank?

Yes, withdrawing $20,000 from a bank is possible. However, banks may have policies regarding large cash withdrawals, so it is advisable to contact your bank beforehand to understand their procedures.

The Bottom Line

While some banks and credit unions still apply a six-transaction monthly limit on savings and money market accounts, this is no longer a federal requirement under Regulation D. Always check with your financial institution or review your account terms to confirm any applicable restrictions and understand your options.

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