Network Program Last updated: 2026-06-27 Author: Hans Goldstein, NPN 20602398

CDARS Program Explained — FDIC Coverage for Large Deposits

TL;DR The Certificate of Deposit Account Registry Service (CDARS), now operated under the IntraFi brand, lets one CDARS-member bank place your large deposit across dozens or hundreds of partner banks in $250K-or-less slices. Each slice is fully FDIC-insured at the recipient bank. You get one statement, one banking relationship, and up to ~$50M of FDIC coverage. Rates are slightly below the best direct-bank CDs but the operational simplicity is unmatched for large depositors.

What CDARS Is and How It Works

CDARS is a deposit-placement service originally developed by Promontory Interfinancial Network (now operating as IntraFi). Member banks participate in a network; when a customer of one member bank deposits a large balance, the bank places that deposit across other member banks in slices of $250,000 or less, ensuring each slice is fully FDIC-insured at the recipient bank.

The customer experience:

You deposit $2,000,000 with your local bank (a CDARS member).
Your bank works with the CDARS network to find 8+ recipient banks willing to accept ~$250K each.
The deposit settles. You have one CDARS statement showing the placements.
Each placement is a separate CD at a separate FDIC-insured bank, fully insured.
You receive one consolidated statement, deal with one bank, get one set of tax documents.

CDARS specifically handles the CD (term deposit) product. For demand deposit and money market sweep equivalents, the sister product is ICS (Insured Cash Sweep) — see our ICS guide.

Coverage Limits — How High Can You Go

CDARS supports very large deposits. The practical limits:

Deposit Size	Approximate Number of Recipient Banks	Coverage Status
$500,000	2-3	Fully FDIC insured
$1,000,000	4-5	Fully FDIC insured
$5,000,000	20-25	Fully FDIC insured
$10,000,000	40-50	Fully FDIC insured
$50,000,000	200+	Fully FDIC insured

Beyond ~$50M, CDARS placement becomes operationally constrained by available network capacity at the moment, but the system has accommodated nine-figure placements for large institutional clients.

Mechanics of the Placement

When you commit funds to CDARS through your bank:

You specify the term (typically 4, 13, 26, or 52 weeks; longer terms available).
You specify the interest rate (single rate applied across all placements).
Your bank coordinates with CDARS to allocate the funds across recipient banks at that rate.
The recipient banks receive funding through the network at the agreed rate.
Your bank handles all customer service; the recipient banks have no direct contact with you.

If you have an existing CD relationship at one of the recipient banks (separate from CDARS), the FDIC limit applies cumulatively — your CDARS allocation to Bank X plus your direct deposit at Bank X must stay within $250K per ownership category. CDARS allows you to designate banks to exclude from your placement to avoid this overlap.

Rate Comparison vs Direct CD

CDARS rates are typically 10-40 basis points below the best direct-bank CDs of similar term. The discount reflects:

The placement network's fee, embedded in the rate.
The fact that you're dealing with a single relationship bank, not shopping each recipient.
The recipient banks accept the funds at network rates that may be below their own retail promotional rates.

Sample comparison in mid-2026:

Term	Best Direct CD	CDARS Yield	Trade-off
3 months	4.85%	4.55-4.65%	~20-30bps
6 months	5.00%	4.60-4.80%	~20-40bps
1 year	4.90%	4.55-4.75%	~15-35bps
2 years	4.80%	4.50-4.70%	~10-30bps

On $1M for 1 year, a 25bps discount costs $2,500. For a depositor who values single-statement simplicity and the operational savings of not managing multiple banking relationships, $2,500 is often a defensible price.

When CDARS Beats Stacking Yourself

You have $1M+ to deposit and want operational simplicity. Managing 4-10 separate bank relationships, with separate online logins, separate statements, separate 1099-INT filings, and separate beneficiary designations is real work. CDARS eliminates all of it.
You don't want to actively rate-shop. CDARS gives you a single rate negotiation with your relationship bank.
You value the existing bank relationship. Local community banks that participate in CDARS often offer it as a service to retain larger customers who would otherwise need to leave for FDIC reasons.
You need eventual liquidity planning. CDARS provides one set of maturities to track instead of 5-10.

When CDARS Doesn't Beat Stacking Yourself

You have under $500K. The fee impact is large relative to the simplicity benefit. Two direct bank CDs are usually a better deal.
You want the highest possible yield. Direct-bank CDs at the best-rate institutions consistently beat CDARS by 15-40 basis points.
You're rate-shopping aggressively. Promotional CDs at specific banks (Marcus, Synchrony, Ally during promotional periods) can be 50-100 basis points above CDARS for short periods.
Your bank doesn't participate in CDARS. Not all banks are members. If you'd have to switch banks to access CDARS, weigh the relationship cost.

Where MYGAs Fit

For depositors with $500K-$5M in fixed-income allocation and a 3-7 year horizon, multi-year guaranteed annuities from A-rated carriers offer 5.4-5.9% yields in mid-2026 — typically 100-150 basis points above CDARS rates. Splitting the allocation across 2-3 carriers stays within state guaranty fund coverage on each carrier slice (similar concept to CDARS bank-slicing, but with insurance carriers). The trade-off: surrender charges, no FDIC insurance, longer commitment, less liquidity. For the slice of large savings already destined for multi-year lock-up, MYGAs are the structural yield winner.

Frequently Asked Questions

Is CDARS FDIC-insured?

Yes — every slice placed through CDARS is at an FDIC-insured bank, fully covered up to $250K per ownership category at each recipient bank. The aggregate placement stays fully insured.

Who operates CDARS?

CDARS is operated by IntraFi (formerly Promontory Interfinancial Network). IntraFi runs the placement network connecting member banks.

Do all banks offer CDARS?

No — only CDARS member banks. Thousands of community and regional banks participate. Check with your bank or search the IntraFi member directory.

Are CDARS rates lower than direct-bank CDs?

Typically 10-40 basis points lower. The discount pays for the placement service and the simplicity of a single relationship.

Can I withdraw early from a CDARS CD?

Yes — but with early-withdrawal penalty, same as any CD. Each placed slice is subject to the recipient bank's penalty formula. Your relationship bank handles the mechanics.

How many recipient banks does a $1M CDARS placement use?

Typically 4-5, each receiving up to ~$240K-$250K with a small buffer below the FDIC limit to account for accrued interest.

Is there a maximum CDARS deposit?

Operationally, very large — placements above $50M have been completed. There's no published hard cap, but very large placements depend on network capacity at the time.

What's the difference between CDARS and ICS?

CDARS handles term deposit (CD) placements. ICS (Insured Cash Sweep) handles demand deposit and money market placements. Same parent (IntraFi), different products. See our ICS guide for details.

Get a second opinion on your CD or large-deposit strategy

Talk to a licensed independent expert before you commit to a multi-year CD or place a large deposit.

Whether you're stacking FDIC categories, choosing a brokered CD desk, or weighing MYGAs against CDs for your fixed-income bucket, a 15-minute independent review confirms (or improves) your plan.

Hans Goldstein - 213-414-2808 - NPN 20602398, independent licensed insurance producer appointed with multiple A-rated carriers

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Disclosure

This article reflects publicly available information and approximate rates as of the date stated above. CD rates, brokered CD inventories, FDIC and NCUA rules, and carrier MYGA rates change frequently — often daily. Always verify current values against the issuing institution's official disclosure documents before committing funds. This article is general information for educational purposes; it is not a personalized recommendation, solicitation, or offer of any specific product. Hans Goldstein is an independent licensed insurance producer (NPN 20602398) appointed with multiple A-rated carriers across the annuity market; this article is not an endorsement of any specific bank, brokerage, credit union, or carrier. No compensation has been received from any reviewed institution in connection with the publication of this article. FDIC and NCUA insurance limits, ownership category rules, and the operations of CDARS, ICS, and other IntraFi programs are governed by federal regulation and the program documents; always confirm coverage with the institution and refer to FDIC.gov, NCUA.gov, or IntraFi.com for the official rules. MYGA carrier financial strength ratings, state guaranty fund limits, and tax treatment are subject to change. Always read the actual contract and consult a licensed advisor before purchasing any annuity, CD, or insurance product.