The daily morning journal and courier., 1907-02-04
RENTING A BANK ACCOUNT.

CT valuables can rest securely. It means that the banks actually rent to some of their customers the right to deposit money with the receiving teller and to cash checks at the paying tel ler's wicket. Rental of a bank account also carries with it the right on the tenants part to bank book and check book, and to a place on the banks great ledgers and debit books. The rented account also gives the free dom of the financial institution's mar ble halls. But it does not entitle the renting depositor to use the banks money. As in other cases of renting, the tenant must do his own furnishing.
 The business of renting bank &C., counts is natural outgrowth of the growing popularity of the bank ac- count among people of moderate means. Years ago it was distinction to be known as a man who had a bank account" Tn those days bank ac- counts were confined to business hous- es with important incomes, or to the wealthy man who could deposit con siderable money. Other people kept their funds in private safes or stock ings, or used a savings bank for what ever they did not need immediately. Then came the establishment of branch banks in uptown business or residen- tial regions. These at first were anX- ious to gain customers, and small ac counts, averaging as low as one hum dred dollars, were welcomed. The housekeeper was asked to keep her small monthly allowance in the bank, and to pay her bills by check. To the small salaried man the same privileges were extended, and the business of the little shops was much sought These small customers advertised the branch bank, and so brought it other and more important business. Gradually the branch banks, too began to gain large depositors, and to grow conservative about accepting small accounts. It was found that the largest income which the bank could hope to derive from a one hundred dollar account about three dollars and half-hardly paid for the cost of the bank book and check book furnished to the depositor, and for rent, light, bookkeeping and other expenses necessary to keeping such a balance on the books A num- Der of successful branch banks there upon raised their minimum to an ac- count averaging two hundred dollars, which gives the bank a small profit.
 The banks, however, had a great deal of difficulty refusing to take the accounts of many people who wished to keep accounts running even less than one hundred dollars, and who would regard an average account of two hundred dollars as undreamef of afiluence. To avoid hurting the feel ings of these people, some of the banks offered to rent bank accounts to such depositors. They offered ito let the cus- toner use their bank facilities for whatever amount he cared to intrust, for the sum of one dollar a month, or twelve dollars year. This it was thought, woub3 be a polite way of get ting rid of seventy-fiye dollar accounts. Then, to the surprise of the banks, many people took up the offer, and now pay twelve dollars year for the priv ilege of keeping an account which runs from fifty dollars to one hundred dol lars in the bank. On the other hand, the banks are living up to their side of the bargain. These persons, in return for rent paid have the satisfaction of knowing that the bank will take the same amount of trouble in safeguard ing their forty dollar account that 1t bestows on a ten thousand dollar book. The renting depositor can pay his bills by check, have his small notes or ac- counts collected and get his book bal anced whenever he feels like it. He can feel, moreover that he is under no obligation to the bank because he is paying the proper price for what he gets.
 On the face of 1t, however, it seems financially strange that any one with over seventy Five dollars should be will ling to pay twelve dollars a year to keep it in a bank A possible explana- tbon of this was given by R. A. Purdy, manager of the Times Square branch of tho Mechanics and Traders bank, which has a few of these renting ac- counts
 "A check account" said MT. Purdy, tis a great convenience, even to the man who has moderate salary. He can pay his rent, the bills of his gro- cer, butcher and candlestiek maker by mailing them a check, which is in it. self a receipt. Moreover he can pay other bills and order things by mail, instead of being compelled to call in person or go to a postoffice and get a money order for a fee. Probably many men also find that if they carry money around With them it goes heav- en knows where. If they have to stop and draw a check they are likely to think twice before they make a pur- chase. Probably some men established these little accounts for their wives, in order to teach them household ac- counting. To all of these men a bank account is worth twelve dollars year in the trouble it saves them. Yes, there may be some men who are vain about having a bank account, and for the satisfaction of paying by check are willing to spend a dollar a month. But in general, I think it is the utility of a bank account which leads people to pay what you might call rent for a lit- tie space in a banks big business New York Tribune.