Making eBanking Rates Different

by Mary Beth Guard

Question: Can a bank legally pay a higher interest rate on depository products through alternative delivery channels, such as telebanking or the Internet? The exact product would be at a lower interest rate in a traditional branch.

Answer: There is nothing in the law or regulations that would prohibit you from having different (e.g., higher) deposit interest rates on products delivered through nontraditional means, providing you have sound business reasons for the pricing differentials. For example, you may want to price the products higher in order to incentivize customers to use the new delivery channels, or you may be able to pay higher interest because your delivery costs are lower.

Originally appeared in the Oklahoma Bankers Association Compliance Informer.

First published on BankersOnline.com 7/16/01