Interest on Business DDA

​Paying interest on the low balance for the account period is not allowed on consumer deposits within Reg. DD. However, for business checking it seems to make a lot of sense. We are thinking we should pay interest on the available minimum investible balances because that represents the stable balances over the past month. By paying only on the low balance for the past statement period, we should be able to promote an attractive interest rate while not over-paying of volatile balances in business accounts. Has anyone else done this or have thoughts about it?

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Neil Stanley
President of Community Banking
TS Banking Group
Treynor, Iowa
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Original Message:
Sent: 02-03-2018 14:36
From: Neil Stanley
Subject: Interest on Business DDA

​Would anyone like to share their bank's strategies today about interest bearing business demand deposit accounts?  Since the repeal of the prohibition in 2011 interest rates are now at a level that we can expect questions from business owners.  How are you dealing with these business account holders?

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Neil Stanley
President of Community Banking
TS Banking Group
Treynor, Iowa
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