Small banks, however, often do not have the resources to develop the sweep or other programs that are needed to compete for the deposits of business customers.
Moreover, from the standpoint of the overall economy, the expenses incurred by institutions of all sizes to implement these programs are a waste of resources and would be unnecessary if institutions were permitted to pay interest on demand deposits directly. The costs incurred by banks in operating these programs are passed on, directly or indirectly, to their large and small business customers.