For Banks, Are Accounts that Hold Funds out of Which Electronic Money is Redeemed Subject to Reserve Requirements?
• Non-banks are not subject to reserve requirements. • The bank accounts subject to reserve requirements are “transaction accounts” and “nonpersonal time deposits” (the reserve percentage for nonpersonal time deposits is currently zero). • The term “transaction account” is defined to include, among other items, any account (other than a savings deposit) from which the account holder may make third party payments at an ATM, remote service unit or other electronic device. 12 C.F.R. §204.2(e). • The definition of “savings deposit” creates opportunities for banks to structure accounts with third-party payment features that avoid reserve requirements. The definition includes accounts in which the bank reserves the right to require at least seven days’ advance notice of withdrawals, and accounts from which the depositor can make up to six transfers and withdrawals (no more than three third-party payments) per statement cycle. 12 C.F.R. §204.2(d). Numerous banks have also instituted arrangeme
