§4005 — Title 12 Banks and Banking | U.S. Code

Summary

Banks and credit unions must start paying interest on money placed in an interest-bearing account no later than the business day they give temporary (provisional) credit for those funds. Some specific accounts are excluded if the bank delays interest for all deposits and gives the required notice. The law does not force payment of interest on money deposited by a check that later bounces.

Title 12, §4005

Banks and Banking — Source: USLM XML via OLRC

(a)Except as provided in subsection (b) or (c) and notwithstanding any other provision of law, interest shall accrue on funds deposited in an interest-bearing account at a depository institution beginning not later than the business day on which the depository institution receives provisional credit for such funds.

(b)Subsection (a) shall not apply to an account at a depository institution described in section 461(b)(1)(A)(iv) of this title if the depository institution—

(1)begins the accrual of interest or dividends at a later date than the date described in subsection (a) with respect to all funds, including cash, deposited in such account; and

(2)provides notice of the interest payment policy in the manner required under section 4004(e) of this title.

(c)No provision of this chapter shall be construed as requiring the payment of interest or dividends on funds deposited by a check which is returned unpaid.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective Sept. 1, 1988, see section 613(b) of Pub. L. 100–86, set out as a note under section 4001 of this title.

§4005 Payment of Interest

Summary

Title 12, §4005

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Citations & Metadata