What is Group Banking?
Group banking is offered by some banks to incentivize a whole group of people, like employees of a company, to have a relationship with the banking institution.
How Does Group Banking Work?
A bank may team up with a large employer and offer its employees special benefits if they open an account with direct deposit. To entice a large number of employees to sign up as new customers, the bank may offer lower rates on CDs, home equity loans, mortgages or other financial products.
Why Does Group Banking Matter?
Group banking members may have access to lower interest rates, lower fees, discounts and other perks not available to regular account holders. Group banking can also provide a more personalized banking relationship for the members if the bank designates one representative, who is generally more knowledgeable about the group's needs, as the point of contact for all the members of the group.