OCR Text |
Show I THE SMALL BANK ACCOUNT. I , , I Theve has of late aiisen a somewhat ani mated discussion, says the New York Nation, especially in families of moderate means who 1 keep small bank accounts upon which to draw I checks for household payments, over the Intlm- at ion by their banks that the account cannot be ' continued unless the deposit is maintained at a stated amount. Sometimes the intimation ' comes in the form of a refusal to open the ac- count unless such a stipulated minimum can be assured. More often it takes the shape of a notice that the average deposit account is too I small, and that unless it is maintained at or above a. specified figure, a monthly charge will be imposed for carrying it. In some of these notifications the hank declared its purpose of charging a dollar a month for carrying deposit accounts which averaged below $200. This, in the eyeshot most people, would be equivalent 1o notice of withdrawal for the proposal that a depositor shall pay G per cent on his own deposit for the privilege of having it carried, is financially finan-cially preposterous, The position of the banks is, that the bookkeeping, thq, clearing and collection col-lection of checks, and the other incidental expenses ex-penses of the office are as applicable to a small account as to a large one, and that where (as in most household accounts) the number of separate sep-arate checks drawn on the account bears exceptionally ex-ceptionally high proportion to the average credit standing of the bank, the performing of these functions may cost more than the bank could possibly earn by lending out the deposit. The late Fredeiic D. Tappen one of the shrewdest judges of banking practice in his day, discussing the question, held that a small deposit account of today might be a large one next year or some years later, and that the business of a bank was to look for customers; also, that the uso of a given bank's checks, in the payments even of a small depositor, was the best of all adveitisements for that bank, and the cheapest, too. The bank may make no .profit from the account on which are drawn the checks to settle set-tle butchers' or bakers' bills, but it may, in the couise of time, get the butcher or baker himself as a depositor. v There is undoubtedly a tendency among depositors, in these days of competition between be-tween trust companies, savings institutions, and deposit banks for obtaining accounts which will -rest for a reasonable period undisturbed, to leave the bulk of a credit fund where it will draw some interest and to cut down to the smallest convenient size the deposit account which gets no interest, and on which household checks are drawn. It is not unieasonable for a hank, under such conditions, to point out to a depositor that it must have at least a working njargin in a given deposit, if it is to be expected i to do the work involved in facilitating tranBac- ' tion of affairs by check. H |