Association of Military Banks of America

AMBAGram – Early Federal Government Pay Deposits

AMBA #2020-005
14 December 2020

Many military banks offer their military and federal civil service customers early posting of their federal pay.  Because Congress’ and the President’s actions to extend appropriations occurred last Friday, funds normally transmitted to banks in advance of mid-month payday were delayed.  Consequently, many banks offering early posting are unable to give their federal employee customers early access to those funds.

As your trade association representing your military banking interests, AMBA is keenly interested in the financial welfare of the military and veteran customers you serve.  Our collective efforts seek to help them live within the means their paychecks provide.  Unfortunately, when unanticipated events like COVID-19 and a narrow avoidance of a government shutdown disrupt their financial plans, even our concerted efforts may not be enough to help them avoid significant financial turmoil.

Today, we’ve heard from other non-profit organizations focused on military financial readiness that they believe many military families will spend or may have already spent military pay not yet posted to their accounts.  If those disbursements result in overdrafts, these families will suffer additional financial pain simply because our federal government could not extend appropriations in a timely manner.  These organizations requested that we ask our member banks to waive any overdraft fees resulting from this situation.  We responded that although we have no influence over the business decisions and activities of our member banks, we will ask you to treat these particular customers with the understanding and patience they deserve.  

We wish you and your banking team the very best Holiday Season!!!