Definition of 3-6-3 Rule
3-6-3 Rule is used to relate to an “unofficial rule” under which loan agencies once managed, which refers to it being noncompetitive and simple.
Brief Explanation of 3-6-3 Rule
The 3-6-3 rule explains how lenders would give 3% attention on depositors’ records, offer the depositors cash at 6% attention and then be child at 3 pm. This refers to how a bank’s only form of business is loaning out cash at better pay than what it is paying out to its depositors. Many feature the problems experienced by loan agencies during the activities that lead up to the Great Depressive disorders as reasons why the federal govt. applied stronger financial rules. These rules managed the rates at which financial institutions can offer and take a loan. Unfortunately, the rules made it difficult for financial institutions to contest with each other and loan agencies became flat. However, with the helping to loosen of financial rules and the extensive adopting of technology such as the internet, financial institutions now are employed a much more aggressive and complicated manner. For example, financial institutions are now offering insurance, broker and other types of financial services.