why do banks need an extra day to process paychecks after ‘bank holidays’ when almost everything is automatic/digital?
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[Have you seen _Superman III_? Ok, how about _Office Space_? This’d be easier if you had.](https://www.youtube.com/watch?v=iz7XK98_9LM)
OK, let’s talk about pie. Imagine “money” as your favorite kind of pie. Pie **is** money. Each slice of pie is worth _something_: bigger slice is ‘worth’ more, smaller is ‘worth’ less.
When pie is sliced, _there are crumbs_. Tiny bits of pie – which we already agreed _is_ money – that aren’t part of the slice OR the pie. Crumbs.
Banks exist, and make money, by collecting and counting the crumbs. Sometimes crumbs are called “dividends” or “interest” but the key thing to know is that _crumbs are money_. And Banks care about every microscopic crumb.
Banks take your slice of pie and “deposit it” while giving you a slice of their pie “from the vault”. IT IS NOT THE SAME PIECE OF PIE. Your deposited slice goes into the vault where the Bank earns **interest** on it. Interest is another word for crumbs. Imagine a tiny, tiny, microscopic bit of crust flaking off. Does nothing to ‘devalue’ the slice: but a flake of crust is a flake of crust. It has value.
The bank takes your slice of pie (deposits your check) and collects the crumbs from _thousands of transactions_. Again, it’s _never_ a whole cent. It’s fractions of a cent. Eventually, a lot of microscopic crumbs swept into a pile becomes an actual pile of crumbs.
The crumbs and little leftover bits _are still money_. Fractions of a fraction. If pie equals 100 and 99.5% the pie went out in slices _there’s still money on the plate._ Not a lot. _Crumbs_. Banks (literally) “sweep these up” and put them into their General Ledger. Every day. And TWICE on Bank Holidays.
“Holds” are the Bank keeping your slice of pie in the vault, collecting crust flakes and crumbs. “Bank Holidays” allow them to get an extra day of “interest” on deposits. To collect more crumbs.
TLDR: Banks make interest on your “deposit” and a Bank Holiday adds an extra day of interest. Also, Banks want your pie.
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