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Introducing the Demand Deposit Marketplace® (DDM) Program: Protect your money with FDIC insurance on balances up to $50 million!

Rachel Kent

In today's ever-changing financial landscape, it's essential to explore innovative and secure options for managing your funds. At Climate First Bank we are focused on helping you make the most of your money. The Demand Deposit Marketplace® (DDM) program is the most flexible, multi-million-dollar FDIC insured cash management solution available. Designed as a liquid alternative to money market mutual funds, DDM offers customers the opportunity to obtain substantial FDIC insurance coverage, daily liquidity, and potentially higher returns. In this blog post, we will delve deeper into the DDM program and highlight its advantages over traditional investment options.

What is the Demand Deposit Marketplace® (DDM) Program?

The DDM program is an FDIC-insured alternative that presents a compelling opportunity for depositors seeking a safe and profitable way to manage their funds. By partnering with financial institutions participating in the DDM program, customers gain access to millions of dollars in FDIC insurance coverage while enjoying the benefits of daily liquidity and the potential for increased returns.

Understanding FDIC Insurance Coverage

When participating in the DDM program, joint accounts can receive up to $100 million in FDIC insurance coverage, while all other account types receive up to $50 million per Taxpayer Identification Number (TIN). It's important to note that individuals in different categories of legal ownership may be eligible for even higher insurance amounts.

Risk Mitigation through FDIC Insured Placements

One of the most significant advantages of the DDM program is the elimination of market risks typically associated with money market mutual funds and other direct cash instruments. By utilizing FDIC-insured placements, customers can significantly decrease their overall portfolio risk.

How are High Levels of FDIC Insurance Achieved?

To achieve high levels of FDIC insurance, cash balances in customer accounts are allocated daily into the DDM program. These deposits are divided into increments of no more than $250,000 and distributed among multiple DDM Receiving Banks. This allocation process aligns with the FDIC's pass-through insurance provisions. By diversifying deposits across multiple banks, customers can maximize their FDIC insurance coverage while maintaining daily liquidity and the convenience of a single banking relationship.

Customer Choice and Flexibility

While participating in the DDM program, customers have the option to exclude any specific DDM Receiving Bank if they wish. However, it's important to note that opting out of certain banks may impact the maximum amount of FDIC insurance the customer can receive.

Differentiating DDM from Money Market Mutual Fund Sweeps

The DDM program distinguishes itself from money market mutual fund sweeps in terms of FDIC insurance coverage. Money market mutual funds are not FDIC insured, unlike the DDM program. Although operationally the DDM program works similarly to a money market mutual fund sweep, deposits are allocated into insured accounts held at various FDIC-insured program banks, rather than being invested in pooled money funds.

Insurance Coverage Timeline

Until funds are swept into the DDM program on the following business day, they remain uninsured at the Participating Institution overnight, exceeding any available FDIC insurance coverage. However, once transferred to the DDM program, the funds become insured on the next business day.

Protecting Customer Funds in Case of Participating Institution Failure

In the unlikely event of a Participating Institution's failure, customers can take comfort in knowing that the funds placed into the DDM program are unaffected. The first $250,000 of the customer's funds remaining at the Participating Institution (if it is FDIC-insured) can be claimed through the FDIC. The remaining funds placed into the DDM program are spread across other FDIC-insured banks, thereby preserving their FDIC insurance coverage and continued availability to the customer.

Advantages of an FDIC Insured Account over Money Market Mutual Funds

The DDM program offers several key advantages compared to money market mutual funds:

• Safety and Guarantee: DDM provides the safety and explicit guarantee of FDIC insurance, backed by the full faith and credit of the US Government, which money funds do not offer.

• Elimination of Market Risks: FDIC insured accounts through DDM eliminate the market risks associated with money fund investing.

• Exemption from SEC Money Fund Reforms: DDM is outside the scope of the SEC's money fund reforms, providing customers with a stable and reliable investment option.

• Competitive Yield: DDM offers highly competitive yields, allowing customers to potentially earn higher returns on their investments.


The Demand Deposit Marketplace® (DDM) program introduces a new dimension to cash management, offering customers the benefits of daily liquidity, substantial FDIC insurance coverage, and the potential for increased returns. By leveraging the DDM program, individuals can mitigate portfolio risk, eliminate market volatility, and gain peace of mind knowing that their funds are protected by FDIC insurance. To explore this exciting opportunity further, reach out to your Climate First Bank representative or visit

Disclaimer: The information provided in this blog post is for informational purposes only and should not be considered as financial advice. Please consult with a qualified financial professional for personalized guidance.

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