A Public Option for Bank Accounts (Or Central Banking for All)

40 Pages Posted: 7 Jun 2018 Last revised: 26 Jan 2019

See all articles by Morgan Ricks

Morgan Ricks

Vanderbilt University - Law School

John Crawford

University of California Hastings College of the Law

Lev Menand

Yale University - Law School

Date Written: December 2, 2018

Abstract

This paper argues that restricting central bank accounts to an exclusive clientele (banks) is no longer justifiable on policy grounds if indeed it ever was. We propose giving the general public—individuals, businesses, and institutions—the option to hold accounts at the central bank, which we call FedAccounts. FedAccounts would offer all the functionality of ordinary bank accounts with the exception of overdraft coverage. They would also have all the special features that banks currently enjoy on their central bank accounts, as well as some additional, complementary features. Government-issued physical currency is already an open-access resource, available to all; the FedAccount program would merely do the same for nonphysical or “account” money. The FedAccount program would bring genuinely transformational change to the monetary-financial system, in ways both obvious and unexpected.

Keywords: banking, central banking, payments

Suggested Citation

Ricks, Morgan and Crawford, John and Menand, Lev, A Public Option for Bank Accounts (Or Central Banking for All) (December 2, 2018). Vanderbilt Law Research Paper 18-33; UC Hastings Research Paper No. 287. Available at SSRN: https://ssrn.com/abstract=3192162 or http://dx.doi.org/10.2139/ssrn.3192162

Morgan Ricks (Contact Author)

Vanderbilt University - Law School ( email )

131 21st Avenue South
Nashville, TN 37203-1181
United States

John Crawford

University of California Hastings College of the Law ( email )

200 McAllister Street
San Francisco, CA 94102
United States

Lev Menand

Yale University - Law School

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