The Main Street Depositor Protection Act expands federal deposit insurance to cover noninterest-bearing transaction accounts—checking accounts that pay no interest—at banks and credit unions. Currently, these accounts are only insured up to $250,000, but this bill would increase coverage to a maximum amount between $250,000 and $5,000,000, to be determined by the Federal Deposit Insurance Corporation within six months of enactment. The expanded coverage applies to regular banks and credit unions, but excludes accounts at systemically important large banks and foreign bank branches. Banks with $10 billion or less in assets would be exempted from special insurance assessments during a 10-year transition period, after which coverage would gradually phase in over time. The legislation aims to protect small business owners and ordinary Americans who hold larger deposits in checking accounts used for payroll and operational expenses.
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