{"version":"2026-sleepy-depositor-premium","name":"SwitchWize Sleepy Depositor Premium","citeAs":"SwitchWize, \"The Sleepy Depositor Premium.\" Retrieved from https://www.switchwize.com/research/sleepy-depositor-premium.","sourcePage":"https://www.switchwize.com/research/sleepy-depositor-premium","headline":{"householdTimeAndSavingsDepositsUsd":9156731000000,"depositsAsOf":"2026-01-01","markupWithSleepyDepositorsBps":68,"markupWithoutSleepyDepositorsBps":32,"wedgeBps":36,"wedgePremiumUsd":32964231600,"wedgePremiumBillions":33,"shareOfFranchiseValueFromSleepinessPct":58,"shareOfClosuresCitingBetterTermsPct":17,"maxShareOfAccountsOpenedThisYearPct":15},"sources":[{"label":"Egan, Hortacsu, Kaplan, Sunderam & Yao, \"Dynamic Competition for Sleepy Deposits\" (NBER Working Paper 34267, 2025)","url":"https://www.nber.org/papers/w34267"},{"label":"NBER Digest summary, \"Bank Competition and Inattentive Depositors\" (Jan. 2026)","url":"https://www.nber.org/digest/202601/bank-competition-and-inattentive-depositors"},{"label":"Federal Reserve, Households and Nonprofit Organizations; Total Time and Savings Deposits (FRED TSDABSHNO)","url":"https://fred.stlouisfed.org/series/TSDABSHNO"},{"label":"SwitchWize Bank Gap Index (a related but distinct live-rate-spread measure)","url":"https://www.switchwize.com/bank-gap-index"}],"methodology":{"summary":"Egan et al. (2025) estimate that the average U.S. bank charges a 68 basis-point annual markup on deposits, driven by depositor inattention -- fewer than 15% of active accounts were opened in a given year, and only 17% of account closures cite switching for better terms. Absent that inattention, the paper estimates the markup would fall to about 32 basis points, a 36-basis-point wedge the paper attributes 58% of bank deposit franchise value to. Applying that wedge to the live FRED TSDABSHNO figure for U.S. household and nonprofit time-and-savings deposits ($9157 billion, as of 2026-01-01) yields approximately $33 billion a year.","caveat":"This dollar figure is a SwitchWize derivation, not a number published by Egan et al. -- the paper reports basis points and a share of franchise value, not a household dollar total. It is also a conservative floor: TSDABSHNO covers only time and savings deposits, not transactional checking balances, so the deposit base the paper actually studies implies a larger true figure. This is a distinct measure from the SwitchWize Bank Gap Index, which tracks the live spread between the national-average and best-available savings rate -- this figure instead reflects an estimate of what depositor inattention alone is worth to banks, independent of where rates currently sit."}}