Friday, June 25, 2010 - 7:29 AM

New Reward Checking Requirement: $200/Mo In Debit Card Purchases

Class Act Federal Credit Union (0 stars) - Details

Class Act Federal Credit Union in Louisville, Kentucky has notified its members that effective August 1st, reward checking members will have to make $200 per month in total debit card purchases in order to qualify for the top rate (currently 4% APY on balances up to $25K). This was reported by FW member Mickie3 in this FW thread.

Will we see more of these requirements? Banks and credit unions which comply with Regulation DD should not be adding minimum dollar requirements. Another FW member in that thread mentioned this FDIC bulletin which included the following Reg DD requirement:

Banks may not require that transactions be of a certain dollar value (individually or in aggregate).

KenBDG5,147 posts since
Nov 29, 2009
Rep Points: 117,067

Edit | History

This post applies to the following states: KY.

Quick
Summary

1. Friday, June 25, 2010 - 4:00 PM

I think that with the new tougher rules on debit cards, we're going to see changes in the requirements from various banks and CUs to meet the monthly requirements that must be satisfied in order to receive the rewards interest rate. Among them could be:

1) Minimum dolllar amount of total monthly debit card purchases in order to qualify.

2) Minimum dollar amount of an individual purchase in order for it to qualify.

3) You'll have to use your card as a credit card, not a debit card, for the purchase to count as a qualifying purchase.

dunker130 posts since
Jun 11, 2010
Rep Points: 383

2. Sunday, July 18, 2010 - 9:42 AM

Class Act Federal Credit Union in Louisville, Kentucky has notified its members that effective August 1st, reward checking members will have to make $200 per month in total debit card purchases in order to qualify for the top rate (currently 4% APY on balances up to $25K). This was reported by FW member Mickie3 in this FW thread.

Will we see more of these requirements? Banks and credit unions which comply with Regulation DD should not be adding minimum dollar requirements. Another FW member in that thread mentioned this FDIC bulletin which included the following Reg DD requirement:
Banks may not require that transactions be of a certain dollar value (individually or in aggregate).

Regulation DD (and thus the above-mentioned bulletin) doesn't apply to credit unions:

Section 230.1 Authority, purpose, coverage, and effect on state laws
Explains that all depository institutions, except credit unions, must provide disclosures about deposit accounts so that consumers can make meaningful comparisons among institutions. Deposit brokers are subject to the regulation's rules on advertising deposit accounts. The regulation implements the Truth in Savings Act; state laws that are inconsistent with the requirements of the act are preempted to the extent of the inconsistency.

Credit unions are governed by a similar regulation, NCUA Part 707.

glxpass38 posts since
May 2, 2010
Rep Points: 238

3. Sunday, July 18, 2010 - 12:34 PM

A bank may pay a higher rate of interest for meeting debit card, internet, or automatic transaction requirements, but may not completely eliminate the payment of interest on interest bearing accounts for not meeting these specific requirements.

The 'completely' part is crucial: banks still pay you some paltry interest if you don't meet the requirements and that measly interest would probably constitute the loophole they try to exploit.

darkdreamer4u168 posts since
Jun 11, 2010
Rep Points: 598