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been permitted to offer a new type of individual savings account from which funds are transferred automatically into a checking account. This automatic transfer service (ATS) enables individual customers to earn interest on funds which previously would have been held in their checking accounts. The usc of these new ATS accounts affects the payments system arid the money supply process.1 Since some checkable balances can be held in savings accounts while other checkable balances will continue to be held in demand deposit accounts, ATS alters the interpretation of existing measures of monetary aggregates.

Automatic Transfers and the Money Supply Process