This article is mixing up a few things, that although related to each other, are distinct. The theory behind negative nominal interest rates is that depositors

This article is mixing up a few things, that although related to each other, are distinct. The theory behind negative nominal interest rates is that depositors will move their money out into the economy where it can earn a the least a positive rate of return, or used for consumption. For some reason this isn't explained very well in the article. Personally I've never bought it, both in theory and practice. Real interest rates (the rate of return you get after accounting for inflation, i.e. real = nominal - inflation) have been negative for some time and there has not been this huge outflow of deposits into other or potentially better investments. It is mostly institutional investors and banks with money parked on the sidelines who are affected by these negative rates, but being (supposedly) risk averse entities, it does sometimes make more financial sense to know you are going to lose 1% a year rather than something more. Ironically, if anything, having a nominal negative rate of interest in a situation where the money remains parked in a bank says more about how low economic expectations are. But the ECB and the Swiss National Bank are setting a negative nominal interest rate because there is political opposition to expanding their balance sheets in the same way the Federal Reserve has done, so negative rates are really their only additional option. Right now there is an ECB bond buying program, but it will only purchase (and inject) about $1 trillion dollars in the Eurozone. The Fed bought about $4 trillion dollars. To call what JP Morgan has done through this "utilization fee" a negative interest rate is slightly disingenuous albeit still correct in principle, in which case your could call any fee that decreases what you put in a negative interest rate. They want to get rid of these deposits because it improves their balance sheet and lets them operate more freely under the current regulatory regimes, or at least make something on the side if the money stays. The articles does state this but it's buried at the end of the third paragraph. Then there is the part about moving away from cash. There has been this push lately by well known academics and some main stream economists of an idea that cash is somehow detrimental to the economy. Beyond the privacy implications and the affect this would have on people who are in the low income segment of society and those who are un-banked, I really don't get it and I think it's driven by the need to try and get creative about monetary policy. I suppose with a cashless society you could technically also move to a completely consumption based taxation system, but this idea runs contrary to the idea of trying to get people to spend money since tax liability would be proportional to how much of your income you spend. It's also difficult to accept the proposition that trying to force people to spend money and increase consumption will improve the economy in a real and long lasting way, when it is savings and investment that drive the real economy. This is my main issue with an extended period of ZIRP or NIRP. No one is inclined to save anything and so investment is funded by further periods of monetary expansion. (And for everyone who is going to say something about the identity S=I, I know, I completely bastardized it and technically it's only true for closed economies but the point still holds the same, savings are important to a having a good economy.)