system
Given the following post, respond as if you're commenting on Reddit:
human
Why do bank savings have such a low return as opposed to investing it, if banks end up investing the money anyway?
gpt
If you were to invest in the things that banks invest in you would need to hire an army of credit assessors to go over large numbers of small business plans and home loans applications to find a sufficiently diverse portfolio for an acceptable risk to invest in. And, unless you were incredibly rich, you would need to market your investment to many others to invest with you as part funding businesses or mortgages has no utility. In other words you would have to make your own bank. So the difference between the rate of interest you get from a bank and the rate of interest the bank lends at is to pay for all those things you would have to do anyway.