Socially Responsible Investing Using Insured Cash Sweep

Insured Cash Sweep for Socially Responsible Investing

Wouldn’t it be nice to secure your money and to help underserved communities at the same time? Whether you are an individual investor or whether you work for an organization with socially responsible investing goals, you can use ICS®, the Insured Cash Sweep® service, to access multi-million-dollar FDIC insurance, earn interest, maintain access to funds, and help make entire communities economically stronger and healthier – all at the same time.1 That is socially responsible investing.

See how one local bank is making a difference in its community.

why ics

Banking on Communities Initiative

The Banking on Communities Initiative is a joint effort by Promontory Interfinancial Network and the Community Development Bankers Association (CDBA) to help CDBA member banks raise funds that can be used to increase lending in underserved communities. The CDBA is a national trade association of the community development banking industry and was established to help its members better meet the credit needs of their communities. Because of their size (small), age (young), and location (underserved communities), CDBA members often find their funding options limited and have fewer resources to devote to attracting deposits. ICS®, the Insured Cash Sweep® service, provided by Promontory Interfinancial Network and offered by banks to their customers, has helped CDBA banks to raise billions of dollars in deposits since the launch of this initiative in 2004. This initiative, in turn, helps those with goals of socially responsible investing succeed.

“By utilizing the CDARS and Insured Cash Sweep services, CDBA member banks have successfully gathered deposits to help underserved communities. These services help the banks to offer their customers access to multi-million-dollar FDIC insurance, which raises customer comfort levels in a way that leads to more deposits for banks in distressed areas – which, in turn, can increase funding available for lending initiatives in economically challenged cities and towns.”

- Jeannine Jacokes
Chief Executive and Senior Policy Advisor
Community Development Bankers Association

How Insured Cash Sweep Can Help

When you work with a participating CDBA bank to place funds through Insured Cash Sweep, the full amount of your deposit is eligible for FDIC insurance – even amounts exceeding the standard FDIC insurance maximum of $250,000 (though limits do apply) – and can be made available for lending initiatives in economically distressed communities. These initiatives can include producing affordable housing, financing small businesses, creating jobs, and expanding neighborhood facilities that provide much-needed services for low-income families. Socially responsible investing is easy using ICS. 

You Can Benefit Too

Earn a Return
Earn interest on funds placed into demand deposit accounts or money market deposit accounts.

Enjoy Peace of Mind
Rest assured knowing that your funds are eligible for multi-million-dollar FDIC insurance – protection that is backed by the full faith and credit of the federal government. No one has ever lost a penny of FDIC-insured deposits.

Feel Good About the Difference You Are Making
Know that the full amount of your funds placed through Insured Cash Sweep can support lending opportunities that create a brighter future for others.2

How Insured Cash Sweep Works

How CDARS ICS Works People 700Px No Text

  • Socially responsible investing is easy using ICS. All CDBA banks are Community Development Financial Institutions (CDFIs). When you deposit funds into the Insured Cash Sweep service through a participating CDFI, everything is handled through that CDFI. That CDFI uses ICS to place funds into demand deposit accounts (through the ICS demand option) and/or money market deposit accounts (through the ICS savings option) with other banks that offer ICS. This occurs in increments <$250,000 so that both principal and interest are eligible for FDIC insurance.
  • By working directly with just one institution, you can access coverage from many. You receive just one regular statement per service option utilized, and your confidential information remains protected.

5 Easy Steps to Get Started

1 Sign an ICS Deposit Placement Agreement.3

2 Identify an existing transaction account or establish a new transaction account to be used with ICS at your bank.

3 Your funds are placed into deposit accounts at other ICS participating banks.

4 See where your funds are at all times by using online tools specially developed for ICS.

5 Receive one monthly statement from your bank summarizing your account activity and balances across institutions.

Learn More

Please visit the list of CDFI/CDBA Members Offering ICS to search for a Community Development Bankers Association member that offers ICS.

1 If you are subject to restrictions with respect to the placement of funds in depository institutions, it is your responsibility to determine whether the placement of funds through ICS, or a particular ICS transaction, satisfies those restrictions. Placement of customer funds through the ICS service is subject to the terms, conditions, and disclosures set forth in the agreements that a participating institution’s customer enters into with that institution, including the ICS Deposit Placement Agreement. Limits and customer eligibility criteria apply. Program withdrawals are limited to six per month when using the ICS savings option.

2 When deposited funds are exchanged on a dollar-for-dollar basis with other banks in the ICS Network, a participating institution can use the full amount of a deposit placed through ICS for local lending, satisfying some depositors’ local investment goals or mandates. Alternatively, with a depositor’s consent to certain types of ICS transactions, the bank may choose to receive fee income instead of deposits from other banks. Under these circumstances, deposited funds would not be available for local lending.

3If you are subject to restrictions with respect to the placement of funds in depository institutions, it is your responsibility to determine whether the placement of funds through ICS satisfies those restrictions.

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