Rising rates. Falling loyalty. | Kasasa

The rate environment continues to place reward account rates at a premium in consumers' eyes.

This certainly isn’t the first time we’ve seen rising rates. But this version is showing signs of continuing to a level we’ve not seen in decades. As rates continue to rise, community financial institutions can offer a compelling APY to lock in new relationships right now. And the reward checking rates don’t need to increase at the same pace as the Federal Funds Rate.  


With 31% of consumers very/somewhat likely to change primary providers, this is a major opportunity that many can’t afford to pass up.1 The sooner you act, the more new account holders you can bring in before rates go any higher.  


1 Galileo 

If you aren’t shifting some focus to interest rates today, you’re managing yesterday’s risk instead of tomorrow’s.

Reward accounts offer huge advantages in a rising rate environment.

Taking a closer look at the advantages of high-yield reward checking accounts — and their unique COF discount — could be a key strategy to reducing fragility in your deposit portfolio.

  1. Reward accounts are not as costly to financial institutions as they initially appear. Nationwide, reward accounts powered by Kasasa provided a median 64% "discount" on cost of funds (COF) in 2022.2

  2. As rates rise, the actual dollar value for loaned-out funds increases — along with an institution's COF. In a rising rate environment, the COF discount offered by reward checking accounts is even more valuable compared to conventional deposit accounts. 

  3. Reward account product designs are highly flexible and can be customized to meet an individual institution’s need for funds, like attracting large balances or new account holders without high deposit. And, unlike CDs, reward account rates can be raised or lowered across the account-holder base at any time.

Reward checking accounts create deeper relationships.

Reward accounts make a significant difference as they can also lead to preferred financial institution relationships that are more loyal and create more income opportunities. So whether you’re looking to add deposits, loans, non-interest income, or even younger account holders, reward checking accounts like Kasasa’s, offer the flexibility to help you meet your unique goals. 

When compared to traditional accounts, Kasasa account holders average2.
2Kasasa Analytics


more monthly debit card transactions.


more non-interest income.


higher loan balances.

The time to prepare for rising rates is now.

If you’re ready to start managing tomorrow’s risk, let’s start a conversation today.