Main Street Depositor Protection Act
- Bill Number
- H.R. 8087
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Status
- Introduced
- Latest Action
- 2026-03-25: Referred to the House Committee on Financial Services.
- Last Updated
- 2026-04-09T05:23:24Z
AI-Generated Summary
H.R. 8087: Main Street Depositor Protection Act
Purpose
To provide federal deposit insurance for noninterest-bearing transaction accounts (checking accounts that pay no interest and allow easy withdrawals for payments) at banks and credit unions, offering protection beyond the standard limit (currently $250,000 per depositor per institution) to safeguard businesses and individuals, especially smaller "Main Street" entities, during bank failures.
Key Provisions
- Insurance Coverage:
- FDIC must issue a rule within 6 months setting a maximum insurance amount for these accounts between $250,000 (minimum) and $5,000,000 (maximum), based on banking stability, economic growth, and the health of the Deposit Insurance Fund (DIF).
- Coverage applies in addition to the standard limit; amounts aggregate across accounts at subsidiaries of the same holding company.
- Once set, the amount cannot change except by new legislation.
- Exclusions:
- No coverage for accounts at subsidiaries of global systemically important bank holding companies (G-SIBs) (major banks like JPMorgan) or insured branches of foreign banks.
- Standard $250,000 coverage still applies to excluded institutions.
- Credit Unions:
- Matches FDIC's insurance limit via the National Credit Union Share Insurance Fund (NCUSIF).
- Definitions:
- Clarifies "noninterest-bearing transaction account" as an account with no interest, flexible withdrawals, and no advance notice required.
- Transition Rules:
- 10-year phase-in plan (published within 1 year by FDIC and NCUA) for including these deposits in assessment calculations.
- Small banks (assets ≤ $10 billion) exempt from special assessments or hikes during transition.
- Regulations:
- FDIC and NCUA can issue rules to prevent evasion (e.g., shifting funds to skirt limits).
Significant Changes to Existing Law
- Amends Federal Deposit Insurance Act (Section 11(a)(1)) and Federal Credit Union Act (Sections 101, 207).
- Revives expired unlimited insurance for these accounts (ended 2013) but caps it at up to $5 million with exclusions for big banks/foreign entities.
- Adds explicit definitions and aggregation rules; mandates congressional approval for future changes.
- Introduces phased assessments and small-bank exemptions.
Potential Impacts
- Citizens and Businesses: Greater security for business checking accounts (often exceeding $250,000), reducing risk of loss in bank failures; benefits small/medium firms without encouraging risk-taking at large banks.
- Banks and Credit Unions: Smaller institutions gain competitive edge in attracting deposits; DIF/NCUSIF faces gradual funding pressure over 10 years.
- Government Agencies: FDIC/NCUA must develop rules, plans, and oversight; potential long-term cost to DIF if claims rise.
- No direct international relations impact, but excludes foreign bank branches to focus on U.S. institutions.
Main Stakeholders Affected
- Businesses and Depositors: Especially those with large noninterest-bearing checking balances (e.g., retailers, local firms).
- Small/Medium Banks and Credit Unions (assets ≤ $10B): Enhanced deposit attraction without immediate assessment burdens.
- FDIC and NCUA: Responsible for implementation, rulemaking, and fund management.
- Large Banks (G-SIBs): Excluded from extra coverage, potentially shifting deposits elsewhere.
- Taxpayers: Indirectly via DIF (funded by bank premiums, not taxes).
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens depositor protections under existing FDIC/NCUA frameworks; anti-evasion rules prevent abuse; "no subsequent adjustments" clause limits agency discretion, requiring Congress for changes.
- Constitutional: No apparent issues; aligns with Congress's commerce clause authority over banking.
- Political: Targets "Main Street" vs. "Wall Street" by excluding G-SIBs, potentially aiding smaller institutions amid recent bank failures (e.g., 2023 crises); promotes stability without broad bailouts.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Recent Actions
- 2026-03-25: Referred to the House Committee on Financial Services.
- 2026-03-25: Introduced in House
- 2026-03-25: Introduced in House
Bill Versions
- Main Street Depositor Protection Act — issued 2026-03-25 — PDF (13 pages)