Banking

What is Monthly Fee Waiver?

A fee waiver means the bank doesn’t charge you the monthly account fee if you meet certain conditions—like maintaining a minimum balance or setting up direct deposit. Common requirements to trigger a waiver include receiving a minimum amount of monthly direct deposits or maintaining a designated average daily balance. These fee structures and waiver conditions must be disclosed upfront under the Truth in Savings Act.

Using monthly fee waivers is an essential strategy for consumer cost management. By structuring payroll deposits or consolidating balances, depositors can maintain accounts for free, preserving capital for savings and investments.

Quick Facts

Disclosure MandateGoverned by Truth in Savings Act (Regulation DD)

Common TriggersDirect deposit threshold, minimum daily balance, linked accounts

BenefitEliminates monthly maintenance fees (typically $10-$25)

Tracking DutyConsumer must monitor criteria monthly to avoid fee charges

PRACTICAL EXAMPLE

A bank charges a $15 monthly fee on its checking account. The fee is waived if the account receives at least $2,000 in monthly direct deposits. Because the customer receives their paycheck of $2,500 via direct deposit, the $15 fee is waived.

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RELATED TERMS

Learn More Key Concepts

Checking AccountA highly liquid transactional deposit account held at a bank, allowing for frequent deposits and immediate withdrawals.

Direct DepositThe electronic transfer of a payment directly into a recipient's bank account, bypassing paper checks.

Minimum BalanceThe minimum amount of money required in a bank account to avoid fees or qualify for a specific interest rate.

Bank StatementA periodic summary of all deposits, withdrawals, fees, and interest earned in a bank account over a set cycle.

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