The Account Is Open, But the Banking Relationship Is Leaving
By Laurie McLachlan, Chief Marketing Officer at Revio Insight
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Financial institutions are learning that an open account does not equate to a valuable relationship with depositors. A demand deposit account can remain open and receive monthly deposits even as depositors move some or all of the funds out each month. Isn’t that the point of DDA, executives might ask? It’s not the DDA that’s creating the miss.
Consumers are moving money out of their DDA accounts to outside credit card providers, wealth management and investment firms, deposit transfer services, buy now pay later and P2P payment platforms, and even to external loan and mortgage providers, according to a May report compiled by Revio Insight that shows which consumer and commercial competitors receive a bank’s outflows.
Need to Know:
- Financial institutions lose about $20 of every $100 in demand deposit balances each month. That’s roughly $12 in consumer outflows and nearly $8 in commercial and business outflows.
- Funds leaving the institution represent economic churn that can result in lost deposit volume, interest income, interchange, fee revenue, and, over time, primary financial institution status.
- Financial institutions can preserve primary status by measuring outflows, identifying product gaps, and equipping frontline teams to act on customer-specific signals.
Businesses, too, have moved significant financial activity outside the institution that provides their DDA. The credit card may be at another bank. Merchant processing may flow through Square. Equipment financing may have gone to an online lender. Excess cash may be parked in a business investment account at Fidelity.
Key takeaway: The DDA is doing its job; it’s facilitating payments. The institution, however, is missing hundreds of millions, and even billions, of originations, revenues, or deposit volumes that could have stayed in-house. Here’s how much money leaves per account type, where it goes, and what institutions can do about it.
The Impact of ‘Economic Churn’
Unlike traditional churn, financial institutions face economic churn, which is the migration of a customer’s financial activity, including deposits, spending, borrowing, and investing, to external providers. While the primary account remains open and active, the institution isn’t just helping consumers and businesses manage their finances. The data shows that most of their financial life is happening elsewhere.
About $20 of every $100 in demand deposit balances leaves a bank every month, according to Revio Insight’s analysis of January 2026 transaction data across 16 community banks with an average of $2.5 billion in assets.
The study, which assessed 16.1 million transactions, also found that every $20 departing the institutions represented about $12 in consumer outflows and nearly $8 in commercial and business outflows.
What this means: These aren’t dollars going to utilities or the grocery store; they are competitors serving an institution’s depositors with services the institutions may also offer.
Lost Interest, Interchange, and Revenue
For most categories, funding outflow is a first loss, but it’s only one of many losses. A competitor is realizing the financial value of the relationship in terms of interest income on loans and mortgages, interchange fees, fee income, and advisory and management revenues from wealth and investment accounts. Insurance or payroll service revenues may also be missed.
Yes, these missed revenue opportunities are caused by customers or members choosing another institution for these services, but was that an informed decision?
Did anyone at the institution ever talk with them or engage them about their needs? Often not. And the bigger the DDA portfolio, the worse the effect of non-engagement on revenue. (See commercial and business outflows by type here.)
To illustrate revenue loss, consider just interchange for commercial and consumer credit cards. At industry-average rates of 1.8 to 2 percent, the 16 banks studied lost roughly $15 to $17 million annually on the card outflows projected for a $1 billion institution.
How to Close the Back Door
Financial institutions cannot ensure that customers or members know their options if staff do not know whom to engage with. Often, institutions assume that if depositors want a service, they will buy it. And that’s true; they just may not buy it from the institution that provides their DDA.
How can banks and credit unions tip the scale? Start by:
1. Measuring economic churn at the transaction level, not the account level. Account retention metrics count closures. They were never designed to catch economic churn. Outbound transaction activity by category is a truer measure of churn: Whose dollars are leaving? Where are they going? And in what volume?
2. Closing the product gaps that are sending your depositors somewhere else. High volume month after month in a particular category is evidence that the product offering set is incomplete and warrants evaluation, especially relative to direct competitors’ offerings.
3. Equipping the frontline with intelligence they can act on. Staff cannot identify unknown needs without a fuller picture of depositors’ actual expenditures. They cannot ask the right questions blindly, nor can they become a trusted advisor without the information that enables them to do so.
Financial institutions cannot preserve primary financial institution status by looking at account status in a vacuum. They also cannot build deeper relationships if data is not harnessed for valuable engagement. Whether an institution uses that data for commercial bankers, frontline staff, or marketing segmentation, no bank or credit union today can afford to miss a depositor’s needs, especially when the institution already offers the service.
Bottom line: Dollars leaving the DDA are a voting machine. By responding to hidden outflows, the institution can turn votes against its deposit offering into signals for action, engagement, and growth. The opportunity is not just to stop money from leaving. It is to understand why it is leaving, which competitors are benefiting, and where the institution has a timely reason to step in before more of the relationship moves elsewhere.
