Susan Wolfe believes banks are seeking to attract more affluent customers by offering cash incentives for high saving deposits. Those same customers might be searching for a safer alternative to the stock market, needing immediate liquidity, or looking for some of the additional customer benefits gained by expanding the relationship with the bank. This makes the savings account a desirable product.
"To compete with the higher interest rates offered by online banks, traditional banks need to market savings accounts as a way to expand the relationship, and they need to focus on the additional value-added benefits and services the bank can provide. Conversely, online banks should continue to focus on the higher interest rates they can provide, since they have a distinct advantage here," Susan Wolfe concludes.
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