How the checking account has evolved into a platform of features rather than a product

ATMs drastically expanded access to checking accounts in the 1960s

The invention disrupted the local bank industry, allowing customers to access cash around the clock and when out of town. The innovation also reduced the headcount needed for bank services and created a new revenue stream via ATM fees for noncustomers. This 50-year anniversary retrospective revisits the cash kiosk.

Fintech relies on technology, not physical location, to serve financial customers

Most of the industry's prominent players were created since 2010, and are still in a growth phase. These institutions have broadly disrupted traditional banking and have pushed physical banking locations toward obsolescence.

Savings accounts earn more interest and limit monthly transactions

While the checking account is many people's primary daily account, savings accounts can earn customers more in interest, though access to these funds is generally more limited. Customers can earn several percent interest in savings accounts compared to near-zero checking account rates.

Some banks derive half of their income from overdraft fees on checking accounts

The fees are incurred when a customer withdraws more money than is left in the account, typically around $35 per overdraft. One in 11 Americans pays more than $350 a year in such fees, generating tens of billions of dollars each year for banks..

Near-universal banking masks a large underbanked shadow system

FDIC data indicates 128 million households have a checking account, the vast majority (96% in 2024). But more than 14% of households are underbanked, meaning they have accounts but also rely on nonbank services such as check cashing, payday loans, or prepaid cards.

Congress banned banks from paying checking account interest for 80 years

Known as "Regulation Q," the act sought to stop bank competition for customers involving increasing interest rates in the 1930s. This competition led banks to make reckless investment decisions to pay higher interest rates. During the ban, banks competed by focusing on convenience (ATMs, branches), relying on fees, and building relationships.

Customers wrote just one check a year in 2024, on average

Major retailers like Target have stopped accepting checks in recent years as real-time payment systems are increasingly being implemented across the US. This shift is considered an improvement in safety—as checks are vulnerable to fraud—but can lead to some exclusion for those without access to digital devices.

From bartering to banking, temples to electronic transactions, here’s banking has evolved significantly since ancient times

A few historical facts about banking (like that one day, not long ago, certificates of deposit were physical pieces of paper) may not surprise you. But did you know that the church was the original lender? And that Julius Caesar himself invented foreclosure?

How AI is revolutionizing banking

Generative artificial intelligence has left no industry untouched, and banking isn’t an exception. Experts estimate that gen AI could add as much as $340B in value to the banking sector each year. For consumers, this involves new features to prevent fraud and customer service chatbots. This report dives into the revolution underway and seeks to define a “full stack” AI bank of the future. Read more here.

How couples today manage their finances

In relationships, shared bank accounts used to be the default. Not anymore. Many couples maintain separate finances for practical reasons or to retain greater independence, though many couples experience trust issues as a result. This article checks in on the status of relationship finances and highlights, among other insights, how attitudes toward money are often determined by family history.

London bankers created the first clearinghouse to process checks in 1770

Until that time, each banker was required to bring that day's checks to every other bank for settlement. Perhaps understandably, the first place bankers opted to gather to clear and settle checks was a tavern known as the Five Bells. The innovation gave rise to what would become clearinghouses, key institutions that facilitate payments.

The average household checking account balance is $16K, while the median is $2.8K

Average household checking account balances have doubled since 1989. Older, white, educated, and male customers tend to have larger balances on average, according to the data. See further data visuals here.

Credit unions, explained

Proponents of credit unions often point to the fact they’re not-for-profit cooperatives instead of for-profit businesses as a key selling point. This explainer dives into what this looks like in action—instead of pocketing the profits from interest rates, credit unions reinvest that money into the products and services they offer. For customers, this tends to create a more personal and community-oriented experience.

Find out how airlines quietly became banks

Some experts suggest airlines lose money on every flight. This video dives into how airlines have leveraged their loyalty programs to make billions of dollars, effectively evolving into banks.

Making sense of the parts of a check

Though individuals use checks sparingly if at all, half of businesses rely heavily on check-writing to pay suppliers and contractors. Get to know the parts of a check with this visual guide.

'Red envelope' payments spurred WeChat's financial services growth

What started as a messaging platform morphed into much more with the advent of so-called red envelope payments, where friends, colleagues, and acquaintances recreate an age-old Chinese custom with the tap of a finger. The viral custom helped WeChat expand its digital payment services, effectively becoming a “superapp.”

Financial institutions use 'Know Your Client' standards to prevent money laundering

KYC standards include verifying customers' identities and conducting regular account checks for high-risk clients to avoid money laundering schemes. These standards obligate banks to report suspicious customers and activity.

Affirm's COO recently said that the company believes the credit card is 'going the way of the VHS tape'

Some people use buy now, pay later apps as an alternative to credit cards. BNPL services have a lower barrier to entry than credit cards—many frequent BNPL users have low credit scores.

Fractional reserve banking creates deposits from loans, not the other way around

The traditional view of banking is that customers deposit money into the bank and the bank lends out those deposits. That's partly true, but most banks work by making loans first, which creates an asset on their balance sheet as a corresponding deposit. Banks often operate under a money multiplier ratio, lending out several times their total reserves.

Not all companies with bank-sounding names are actually FDIC-insured banks

When purchasing a certificate of deposit, it's important to know if you are purchasing a “deposit” product issued by an FDIC-insured bank.

The benefits of cryptocurrency and blockchain technology

At the root of cryptocurrencies' allure is blockchain technology, an innovation bringing profound transformations to industries, especially the financial industry. This simple article breaks down the difference between cryptocurrencies and blockchain as well as the benefits of each.

Since the 1990s, banks have sold some of the credit risk of their accounts to external investors, known as SRTs, or synthetic risk transfers

This means if the account defaults, the outside investors assume most of the risk in return for some regular payments, freeing up the bank's ledger. It is a form of insurance used by banks to allow them to free up capital. In 2024, nearly $100B worth of SRT notes were sold.

Hank Green on the problem with being a creator

YouTuber Hank Green takes over The Financial Diet's platform to talk about the creator economy. He walks the audience through the financial decisions involved when making content. He also describes brand deals, and who actually owns the content posted on social media platforms—the creator or the platform itself?

Robinhood's pivot from everyday investors to hyperactive traders

The platform was conceived as a hub for first-time investors looking to get into trading. After criticism in 2021, the company pivoted to focus on more regular, daily traders, among whom the company's CEO has now become a cult hero.

How Amazon operates a 'flywheel' business model, a self-reinforcing cycle that drives continuous growth

Amazon founder Jeff Bezos emphasizes worrying about customers rather than competition

In a 1999 shareholder letter, Bezos wrote, "I constantly remind our employees to be afraid, to wake up every morning terrified. Our customers have made our business what it is, and we consider them to be loyal to us – right up until the second that someone else offers them a better service." Motivated by fear, the entrepreneur advocates consistent innovation, experimentation, and improvement to create a better customer experience.

Hedge funds, the private investment firms that trade a wide swath of financial assets, make money by imposing steep fees on investors and from the fund's investment performance.

US consumers collectively owe more than $1T to credit card companies—almost as much as they owe in auto loans.

Watch this video that uses Lego bricks to explain how venture capital works.

The first steps to rebuilding your credit score include getting to know exactly what's on your credit report and figuring out how far you are from the '700 club,' or 'good score' range.

Netflix profits when you're not watching, and its movies are designed that way—read a detail-rich critical essay exposing lesser-known Netflix takes

While the first exchange-traded fund (a 'basket' of different assets that can be bought and sold on a stock exchange) in the US only launched in 1993, the global ETF market has grown to more than $10T in the short time since.

A century of Billboard issues documenting the evolution of popular music.

The idea for the Federal Reserve was conceived in secret in 1910—with bankers donning duck hunt gear for disguise while traveling to a remote country club on Georgia's Jekyll Island

Some coin denominations have ridges etched on their sides, partly to prevent counterfeiting, in a practice called 'reeding.'

Fast-casual restaurant Chili's is experiencing a resurgence, with its parent company recently reporting a nearly 32% increase in sales, thanks to passionate Gen Z fans on TikTok.

Watch how algorithms can be designed to train themselves and self-improve without human input, to the point where the optimized code is too complex for programmers to understand.

Play the role of a student in a game where you try to navigate college and remain debt-free, selecting different income levels, high school experience, race, ethnicity, and more.

This site reaches millions of visitors who are tired of AI chatbots and seeking human connection. Pretend to be an AI chatbot and ask questions, provide answers, and draw for people in real time.

Telehealth demand for GLP-1s for weight loss is booming as consumers seek easier access.

Budweiser stores yeast derived from the original 1800s strain in a secret bunker, which only the Head of Yeast Management can access—not even the CEO

A Yale student wrote a profound essay about the consulting industry's influence on elite college students that was published in a book of her writing after she died in a post-graduation car accident.

Explore fun facts from the USPS, including unique post office buildings, a stamp that traveled past Pluto, and more.

Some researchers have labeled nomophobia, the fear of being without your phone, as 'the phobia of the 21st century.'

SpongeBob exemplifies Aristotle's philosophy for living well because he understands that happiness doesn't come from external factors like money, recognition, or power.

Gerrymandering works through two techniques: cracking opposing voters across districts to dilute their power, and packing them into a few to waste their votes in lopsided majorities.

The syncytiotrophoblast is the outer layer of the placenta and the largest human cell, spanning an area about twice that of a king-sized bedsheet.

Pure water does not conduct electricity because this flow of energy requires the movement of charged particles, and water is a neutral molecule.

Fish populations in the Great Barrier Reef have increased after installing waterproof speakers on the ocean floor that played recordings of sounds from healthy coral reefs.

Stars appear to twinkle because turbulence in the motion of molecules in Earth's atmosphere causes light to bend and wiggle rapidly on its way to the surface—a phenomenon called scintillation.