Seeing that the deposits are spread over so great an area, and among men and women who have not sufficient business knowledge to invest their savings advantageously, the banks have been able to keep down rates without reducing their own resources; and the few who do withdraw their savings when the deposit rate is at 1½ per cent. are practically of small account when contrasted with the alternative policy the companies would have to adopt in order to retain them, for it obviously pays better to lose a few receipts than to raise the rate to 2 for the whole of the deposits. For instance, a bank would rather lose £100,000 by withdrawals when the rate is at 1½ than pay 2 per cent. on £5,000,000 for the purpose of preventing the drain, £25,000 being too large a premium to sacrifice for the purpose of retaining its connexion intact, when, perhaps, money is being employed in the London shortloan market at 1½ per cent. and under. Again, very many of the country depositors look upon the deposit-receipt as an investment, and the banks, quite naturally, do not wish to inform them that even Consols are a more profitable one. Not so very many years ago the country minimum deposit rate was 2, and it was not without certain misgivings that it was reduced to 1½; but, as we have seen, the experiment proved safe, though the banks, given another long period of a 2 per cent. Bank rate, will hardly care to risk 1 per cent. in the provinces, as it seems pretty certain that, were the minimum further reduced, disgusted depositors would invest their savings either in the Post Office or the gilt-edged class of securities. Having once turned this stream of deposits into another channel, it is improbable that a higher rate would tempt them back again; and as the depositor is essential to the modern banking system, the provincial banks will think many times before they risk a rate below 1½, even when cheap capital is again reducing their dividends right and left. A customer, before leaving his money with a banker, will be careful to inquire what rate he is to receive, and if the rate be not written upon the receipt, then he might pencil the answer he gets upon the back of the document. If there be three good banks in his town, and he has, say, £200 to deposit, there can be no harm in his going to all, and asking the highest rate each is allowing. John Jones, we will assume, holds a deposit-receipt for £200 dated 10th June and he takes it to the bank on 9th December following in order to draw the interest at the rate of 2 per cent. per annum. Between 10th June (excluding the first day) to 9th December (inclusive) there are 182 days, so the banker owes him 2 per cent. per annum on £200 for 182 days. Hence the following sum:-- (200 × 2 × 182)/(100 × 365) = £1 19s. 10d.