Why would a bank give higher interest rates for money in a savings account than for money in a checking account?




A checking account requires more maintenance than a savings account, and it has a greater variation in the amount of money the bank can work with.


The extra interest in a savings account is used to pay for free checks.


The bank would rather not provide checking accounts, so it gives lower interest rates in hopes that customers will put all of their money into savings.


Money must be left in a savings account for a set period of time, therefore the money earns more interest.