Current Account Savings Account (CASA)

Categories: Econ, Banking

Banks are always looking for ways to get more people to put money into their vaults while reducing the amount of money they need to pay customers in interest. A current account savings account (CASA) is a reliable product stream that allows them to make mucho dinero.

It works like this: a bank will offer customers a checking account that typically would have a monthly fee and other potential fees for free. In exchange, a consumer will link the checking account to another savings account at the bank that has a deposit minimum. So you get checking services for a cheaper cost…but you need to leave your money in a different account that gets a lower interest rate.

It’s a pretty bad deal when you start to measure the opportunity costs of having your money locked up in a savings account with a laughably low interest rate.

Find other enlightening terms in Shmoop Finance Genius Bar(f)