What benefit does a bank get from people putting Savings Accounts in their bank. I mean they reward you with interest, but why give you free money. whats in it for them?
2006-10-30 17:37:20 · 7 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
They lend your money out at a higher interest rate...
That's why in the crash in 1929 there was a run at the bank...
Many banks had to shut down...
Watch "It's a Wonderful Life", at the beginning just as George was to go on his honeymoon, the savings and loan had almost all the people looking for their money.
2006-10-30 17:39:43 · answer #1 · answered by feanor 7 · 0⤊ 1⤋
For every dollar you put in a savings account, $0.90 is loaned out by the bank at a much higher interest rate that you're getting.
In fact, to help back that up, Federal Regulation D prevents more than six withdrawals per statement cycle on a savings/money market account.
That is why savings/money market/CD's interest rates you earn is just slightly less than what the overall prime rate is on loans you pay.
2006-10-30 23:53:47 · answer #2 · answered by jason29445 3 · 0⤊ 0⤋
Jordan, You need to look at the totality of the bank’s services, accounts, and fees. Every bank and credit union offers several accounts with different features and different fees. What fees are there for each account? Some accounts waive all fees if you maintain a minimum balance. The minimum balance varies from institution to institution. Some accounts have a monthly fee, but no fee on each transaction. Other accounts have no monthly fee, but a fee for each transaction. I suggest that you visit several banks and credit unions and speak to the customer service personnel. Bring a written list of questions which are important to YOU. Find out the features and charges of each of their accounts. Make sure you get everything in writing. Do not accept anything the customer service person tells you verbally.
2016-05-22 14:35:30 · answer #3 · answered by Anonymous · 0⤊ 0⤋
When you start a savings account it is a high probablility that the money you deposit will stay in their bank over a longer period of time than a checking account. Banks need money for things like loans, so by putting your money into a savings account you are helping the bank to ensure that they have more money to lend to others, which than helps them gain money through intrest.
2006-10-30 17:46:48 · answer #4 · answered by Alex 3 · 0⤊ 0⤋
While your money is in the bank they loan it to other people and collect higher interest than they are paying you.
2006-10-30 17:40:30 · answer #5 · answered by October 7 · 0⤊ 1⤋
They get 6% and give You 2% . I think they win.
2006-10-30 17:42:19 · answer #6 · answered by canivieu 5 · 0⤊ 0⤋
they get to use you money for investments
2006-10-30 17:39:48 · answer #7 · answered by Anonymous · 0⤊ 1⤋