Some people have asked, if US banks pay a minute amount of interest in savings, and the Fed pays like 2% or more on deposits by banks, why can't someone just start a bank that stores deposits at the Fed and passes through the interest?
And the answer appears to be, because the Fed won't let them, because they are afraid it could undermine the regular banks.
And the answer appears to be, because the Fed won't let them, because they are afraid it could undermine the regular banks.