What Is an Automatic Transfer Service (ATS)?

An automatic transfer service (ATS) is a banking service, in both a generic and specific sense, offered to customers. On a general level, it can signify any automatic transfer of funds among customer accounts. For example, bankers many use an ATS during a transitional transfer from a 澳洲幸运5官方开奖结果体彩网:checking account to pay off a 澳洲幸运5官方开奖结果体彩网:bank loan, and/or a monthly transfer from a checꦰking account to a savings account.

More specifically, an automatic transfer service describes the 澳洲幸运5官方开奖结果体彩网:overdraft protection that a bank provides when it transfers funds from a customer's 澳洲幸运5官方开奖结果体彩网:savings account to his or her checking account, at times when 澳洲幸运5官方开奖结果体彩网:insufficient funds exist to cover unpaid checks and/or maintain a minimum balance.

Ordinarily, a bank will transfer the exact amount of funds required to cover unpaid checks. Customers may thus avoid any overdraft fees, along with the hassle associated with returned checks. Usually, a customer will need to proactively request to turn on overdraft protection on his or her account to make sure no fees areꩲ charged.

How Automatic Transfer Services (ATS) Work

Savings and loans and 澳洲幸运5官方开奖结果体彩网:mutual savings banks first introduced ATS accounts in the 1970s in order to compete with traditional 澳洲幸运5官方开奖结果体彩网:commercial banks. According to the 澳洲幸运5官方开奖结果体彩网:U.S. Federal Reserve (the Fed), ATS offerings count toward the nation’s 澳洲幸运5官方开奖结果体彩网:money supply (the full stock of currency and other liquid instruments, circulating in the U.S. economy at a given time). The M1 metric for money supply also includes travelers' checks, 澳洲幸运5官方开奖结果体彩网:demand deposits, and other checkable deposits, such as 澳洲幸运5官方开奖结果体彩网:negotiable order ofღ withdrawal (NOW) accounts and credit union share drafts.

Given the low rates of interest that checking accounts pay, 🌠these arrangements are the norm rather than the exception. This is particularly the case with checking accounts at brokerage firms. Generally, individuals and sole proprietors are eligible for automatic transfer accounts, while organizations, units of government, and other entities are not eligible.

Additional Features of Checking Accounts

Many traditional financial institutions offer checking accounts, allowing customer 澳洲幸运5官方开奖结果体彩网:withdrawals and deposits. Checking accounts differ from savings accounts in that checking accounts generally offer unlimited withdrawals and deposits, while savings accounts limit these. Checking accounts can be open to commercial or business accounts, student accounts, and 澳洲幸运5官方开奖结果体彩网:joint accounts, along with many other types of account💜s that offer similar features.

Checking accounts are very liquid. Customers can access their accounts, using checks, automated teller machines (ATMs), and electronic debits, among other methods. In exchange for this liquidity, checking accounts usually will not offer a high-interest rate; however, if a chartered banking institution holds this account, the 澳洲幸运5官方开🔜奖结果体彩网:Federal Deposit Ins🧸urance Corporation♈ (FDIC) can guarantee fund൲s by up to $250,000 per individual depositor, per insured bank.