Report: Banks discouraging cash deposits

June 12, 2021 Carley Shaffer US 0

FILE - In this Jan. 21, 2020 file photo, dollar bills have been dropped into a tip jar at a carwash in the Brooklyn borough of New York. Your 20s are a time of self-exploration, finding your footing as an adult — and likely making some mistakes with money. (AP Photo/Mark Lennihan, File)

Dollar bills have been dropped into a tip jar at a carwash in the Brooklyn borough of New York. (AP Photo/Mark Lennihan, File)

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UPDATED 3:04 PM PT – Friday, June 11, 2021

Banks have announced they no longer want cash deposits, particularly from their corporate customers who say they’re flushed with cash. According to recent reports, banks are describing their current cash flow as “too much.”

With companies loaded with cash and interest rates near zero, banks are stressing they are unable to make a profit by lending the cash to borrowers. Reports said deposits have surged this year, jumping from $411 billion to more than $17 trillion between the months of March and May.

A man stands in front of the Verizon logo at the Mobile World Congress (MWC) in Barcelona on February 25, 2019. (GABRIEL BOUYS/AFP via Getty Images)

“We have been operating with a higher cash balance for about 12 months now,” said Chief Financial Officer of Verizon Communications Inc., Matthew Ellis. “There’s been no decision yet if and what to bring it down.”

This comes as the Biden administration is flooding the country with more cash and is seeking even more spending amid inflation concerns.