Corporate treasurers joined banks in lobbying for legislation that would permit interest to be paid on business checking accounts.
"This bill would eliminate an archaic banking law that has hampered the ability of America's businesses, and particularly smaller businesses, to make effective use of funds on deposit in banks," the Treasury Management Association told House Banking Committee Chairman Jim Leach, R-Iowa.
In an Aug. 21 letter released this week, association officials also noted: "Restrictions on these types of accounts also make commercial banks less competitive in serving the financial needs of many business customers."
The group also backs legislation allowing the Federal Reserve Board to pay interest on bank reserves. A bill proposing both these changes was introduced by Rep. Jack Metcalf, R-Wash., on July 31.