In the US, a venture-owned fintech company is building a marketplace where something quite revolutionary is happening.
Whisper it, but it seems that banks that find themselves with an excess of deposits might lend them out overnight to other well-capitalized banks that find themselves temporarily short of funds.
For such short-term loans, banks do not even require collateral.
One might call this an interbank funding market. A robust one might be useful, given this year’s tremors when a few regional banks saw sudden, rapid and wholesale flight of customer deposits.
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