Banking

A Checking Account Is a Dangerous Thing

You have to pass a test to drive a car. Why no test of financial literacy before using a bank?

But can he do compound interest?

Photographer: Peter Macdiarmid/Getty Images

Which is the greater number: $105 or $100 plus 3 percent? You might think this a trivial question, but about 60 percent of adults can't answer it correctly -- and many of them still use financial services. It's an alarming situation. After all, smokers understand they're taking a risk, if only because they've seen the health warning on cigarette packs; but bank clients, especially in poorer countries, are often clueless about money matters.

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