We do not believe a for-profit organization may open a NOW account. However, we believe that you may allow the for-profit organization to open an ordinary interest-bearing account and you should note that the Dodd-Frank Act repealed the prohibition of paying interest on demand deposit accounts. See 76 Fed. Reg. 41392 (July 14, 2011).

The Federal Deposit Insurance Act authorizes NOW accounts (accounts which allow for withdrawals and on which you pay interest) only when the interest is held by “one or more individuals or by an organization which is operated primarily for religious, philanthropic, charitable, educational, political, or other similar purposes and which is not operated for profit.” 12 USC 1832(a)(2). The Federal Reserve has clarified that entities organized or operated to make a profit “such as corporations, partnerships, associations, business trusts, or other organizations may not maintain NOW accounts.” 12 CFR 204.130(b)(1).