Use the latest browser recommended by Microsoft
Get speed, security and privacy with Microsoft Edge
This paper argues that banks can reduce their uncertainty about client characteristics and improve bank performance by learning about clients in the course of the depositor relationship. The information acquired from deposit account information allows them to tailor services to fit the characteristics and capabilities of their customers. The conditions under which such information implies an increase in service quality over time are derived. This paper contributes to the extensive literature on banks' informational role by arguing that banks' valuable functions may include the ability to provide customer-tailored transactions services, which may, but need not, include credit.