How do banks make money from bank accounts?

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asked Mar 27 in Other-Finance by styerjuset (620 points)
How do banks make money from bank accounts?

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answered Mar 27 by Shawn (89,450 points)
Banks make money from bank accounts through banking fees, interest on the money and even through investing and loaning out your money.

Banks benefit from checking accounts through interest the bank earns on your money, through banking fees and even through investing your money and loaning out your money.

Also banks benefit when you overdraft your checking account as long as it's paid back as they get the fees for overdraft which are usually around $50.00 per overdraft.

Banks offer free checking because the banks can earn money on interest from money you deposit into your checking account.

The more money you have in your bank account the more money the bank will earn on interest the longer your money sits in your checking account.

Also the bank loans out money you deposit as well but your money is insured by the FDIC though so you don't lose your money and your money is still available for you to use.

Banks provide free checking accounts because the banks earn money on your money you deposit through interest and by loaning your money out.

The way banks make money on free checking accounts is through the interest the bank earns on the money you deposit into your checking account.

This is one reason why some banks require you leave at least a certain amount of money in the checking account for them to keep the account open.

The more money you keep in your checking account the more money the bank earns on that money you have which allows them to keep your checking account open.

When you deposit money into the bank account your money does not just sit there in the bank but instead is transferred to other bank account holders and even loaned out.

However you still have access to your money even though the bank loans out money you deposit.

Some banks have checking accounts that pay you some interest as well and then some banks charge monthly banking fees to keep your checking account open.

Also if you overdraft your bank account then you get hit with fees as well so banks get rich off of those overdraft fees when the money is paid back.

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