A commercial bank has two primary functions—to manage consumer deposits and to create credit. The first function is at its core just the simple management and accounting stuff—getting cash from ATMs, managing payments, settling cash transfers, and the like. The second function is the more macroeconomically interesting—you lend to businesses and individuals, in the process creating bank deposits, and profit from a combination of risk and interest margins. You can imagine (and many people already have) a system where these two functions are separated. Companies and/or public sector entities manage bank deposits as ... (full story)