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What rate do I pay and/or earn in the network?

Reciprocate: Banks can choose to reciprocate – both sweeping and receiving funds simultaneously – to offer access to extended insurance to their clients without affecting their overall balance sheet size.

  • Rate: When you reciprocate by sweeping the same amount of funds you receive back to your bank, the network rate offsets itself, leaving only the NBID usage fee. Your institution has full discretion on how much rate to pass on to clients in the program.
  • Reciprocating Volume: The bank has the ability to 1) reciprocate the full amount swept into the network to maintain balance sheet size, 2) reciprocate less than the full amount swept into the network to reduce balance sheet size and earn additional fee income, or 3) reciprocate more than the full amount swept in network to grow the size of the balance sheet.

Sweep: Banks can sweep client funds into the NBID network to offer access to extended insurance to clients in addition to sweeping off underplayed excess deposits to potentially improve financial metrics and earn fee income.

  • Rate: Banks earn the network rate (typically around effective federal funds rate) on any deposits swept into the network from institutions receiving those funds, minus the NBID usage fee. Your institution has full control over how much rate to pass on to clients in the program.
  • Example: When the network rate they earn is effective federal funds rate (4.33% as of February 11, 2025), and your bank offers 1% interest rate (illustrative) on the Insured Sweep Account, you will earn 3.33% on deposits in network minus NBID fees.

Receive: Banks can source stable, cost-effective funding on demand from other banks in the NBID network. This can help boost liquidity and fuel asset origination.

  • Rate: Banks pay the network rate (typically around effective fed funds) on funds received. Interest is accrued daily and paid monthly. There are no NBID fees associated with receiving funds.
  • Example: If the network rate is 4.33%, your institution will pay the network rate on funds received for the number of days the funds remain on your balance sheet.

For more information on setting rates for your clients, click here, and for details on interest payment and monthly settlement, click here.

Updated 7 days ago

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FDIC Disclosure

NBID is not a member of the Federal Deposit Insurance Corporation (FDIC) and is not a financial institution, nor does it offer financial institution deposits and its services are not guaranteed or insured by the FDIC.

Funds placed through NBID's deposit network are deposited at FDIC-insured banks. Each participating bank provides FDIC insurance coverage up to $250,000 per depositor. By spreading deposits across multiple banks in the network, customers may be eligible for aggregate FDIC insurance beyond the standard $250,000 limit provided by a single institution. Customers should monitor their total assets at each program bank to determine the extent of available FDIC insurance coverage.

A list of participating network banks is available upon request. FDIC insurance is subject to FDIC rules, including pass-through coverage requirements. For more information about FDIC insurance, visit www.FDIC.gov.

*Deposits exceeding applicable FDIC coverage limits at any single institution are not insured by the FDIC.

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