The Way Forward: Making Checking Account Origination Profitable Again
| Published: | October, 2011 |
| Format: | |
| Length: | 8 pages |
| Author: | Nicole Sturgill, Research Director at TowerGroup, a Corporate Executive Board company |
Many financial services institutions have come to the unsettling realization that the checking account in its current form is not profitable. While banks can generate revenue through products, services, and fees outside of retail banking, it is not a practical long-term business strategy to position the demand deposit account (DDA) as a loss leader. This white paper by Nicole Sturgill, Research Director at TowerGroup, a Corporate Executive Board company suggests that FSIs must look beyond the development of a new or changed product set and instead consider a new way of doing business. FSIs must now make overall profitability measurement standard operating procedure. But the change must go beyond measurement and optimization. FSIs have to earn customers’ trust to convince them to give the bank more business.
