I guess I come from another era, but it seems to me that instead of charging fees for services like debit cards, banks should pay customers for the privilege of holding their money. After all, when a bank has my money, it aggregates it into a big pile with everyone else’s money, invests it, and makes more money, right? So where’s my cut?
When I first started keeping money in banks, they paid interest. Even on one of those old-fashioned passbook savings accounts bearing just a few hundred dollars, little bits of interest accrued. Today banks have added more services—there were no debit cards in those days, for example—but they still have my money. So today’s whine is a simple one: where’s my interest?
What I’m actually doing is lending the bank my money. When I borrow the bank’s money, I have to pay interest on the loan. But when the bank borrows my money, it charges me fees. What kind of logic is that?
The disappearance of interest from consumer bank accounts happened long before the economic crisis of 2008, so pointing to a recession is no excuse. Even those Internet-era online-only accounts that drew people in a few years ago with relatively high interest rates (4% or so, if I recall) now pay only a tiny fraction of that.
Incidentally, for the traditional large banks, profits are up. So I guess I’ll just bang my addled head on the wall one more time and ask: Where’s my interest?