Ok. this is probably a stupid question but I'm going to ask anyway. When monitoring savings and money market accounts for excess debit transactions, is limited to six per person or per account? When I was reviewing accounts I noticed that I had two customers who had accounts with us that I had sent letters to for excess debits. But the accounts that exceeded the limits this time were different accounts than the ones I had previously contacted them about. I guess it's something I've never really thought about until now.

The limitations are put on the account, not the customer, so it would be limited on a per account basis.

Great! Thank you! That is what I thought I just couldn't find it anywhere and I wanted to be sure.

But if the customer is daisy chaining accounts to avoid the limitations, you still have an issue.

Given today's rates, there is no appreciable increment in rates paid on MMDA's vs. interest bearing DDA's. Reviewing savings accounts for "excess activity" increases the cost of those funds and is, frankly, ridiculous.

Consider eliminating your MMDAs entirely, converting them to interest bearing DDA's.

Down the road, when rates have edged upward somewhat, there may be a strategic reason to again offer the MMDAs. But for the reasons Ken provided, they really don't make sense now.

As noted, it's about the interest rates... Congress "invented NOW's and MMDA's in the 1980s to preserve bank deposits when rates on time deposits were in the double digit range. (If an interest bearing DDA was available at the time, there would have been no need to invent them at all.)

I simply don't believe we will see that rate structure again in my lifetime. Regardless, these accounts have been obsolete since 2011 when it became permissible to pay interest on a DDA.

Banks could design their products to reflect the marketplace and adapt them if the marketplace changes, but freedom is a difficult thing to understand if you have never had it before.

Thank you everybody for the information. They did not open new accounts because of hitting the limits on the other account. They had both accounts open already. But they should be paying more attention to the limits because they have been notified on the other account. And it's not MMDA's that we have a problem with. We rarely have an MMDA that hits the limits. The problem is Savings accounts. Mostly people who have sweeps set up or people who constantly transferring money on mobile banking or online banking.

You could get rid of your other savings accounts too...

haha I have a feeling management would never go for that.

Depending on the effects on your reserve requirements, I can pretty much guarantee that they would do it, but only if you could get them to listen to you long enough so they understood. It's about designing an array of accounts, all of which are based on the interest bearing DDA, which have differing features and benefits.