I’ve also heard that Mercury has a great user experience, but as you mentioned, sadly, they’re not available for nonprofits. For a for-profit, your money market sweep goes to the Vanguard Treasury Money Market Fund, which is awesome: a reputable provider, $59bn under management, and 5.24% yield*. Mercury also offers a multi-bank sweep option, where you can put your balance across say 20 banks, so you get 20x the $250k FDIC limit in government protection.
If it weren’t for these “invincibility”** features, Mercury may well have failed when Silicon Valley Bank and First Republic failed. Mercury serves mostly startups, who tend to have large balances (over the $250k FDIC limit) and who know each other (and can spark bank runs through their dense networks). Worse, it’s not a bank, and there’s no stock prices or bond prices*** to watch to see when they’re in trouble.
* note that if you got the same yield via a certificate of deposit instead of a money market account, that’s materially worse, since you’re not insulated from bank failures, and may not be able to redeem if the bank becomes distressed
** not actually invincible
*** observable measures of distress are a double-edged sword: you know when the bank is in trouble, but everyone does, so small concerns can snowball into a real large concern
I’ve also heard that Mercury has a great user experience, but as you mentioned, sadly, they’re not available for nonprofits. For a for-profit, your money market sweep goes to the Vanguard Treasury Money Market Fund, which is awesome: a reputable provider, $59bn under management, and 5.24% yield*. Mercury also offers a multi-bank sweep option, where you can put your balance across say 20 banks, so you get 20x the $250k FDIC limit in government protection.
If it weren’t for these “invincibility”** features, Mercury may well have failed when Silicon Valley Bank and First Republic failed. Mercury serves mostly startups, who tend to have large balances (over the $250k FDIC limit) and who know each other (and can spark bank runs through their dense networks). Worse, it’s not a bank, and there’s no stock prices or bond prices*** to watch to see when they’re in trouble.
* note that if you got the same yield via a certificate of deposit instead of a money market account, that’s materially worse, since you’re not insulated from bank failures, and may not be able to redeem if the bank becomes distressed
** not actually invincible
*** observable measures of distress are a double-edged sword: you know when the bank is in trouble, but everyone does, so small concerns can snowball into a real large concern