Prize-linked savings accounts (PLSAs) have been around for centuries. In fact, they're one of the most successful financial products ever created for encouraging savings among everyday people.

A Brief History

PLSAs originated in the United Kingdom in 1694 with Million Lottery bonds. The concept is simple: instead of earning traditional interest on your savings, a portion of the interest is pooled into prizes that are awarded through random drawings.

How Layup Uses PLSAs

When you deposit money through Layup, your funds go directly to nbkc bank, Member FDIC. The bank earns interest on your deposits through the federal funds rate.

A portion of that interest is pooled into prize drawings. The more you save, the more entries you get into each drawing.

Is It Legal?

Absolutely. The American Savings Promotion Act of 2014 explicitly authorizes federally insured financial institutions to offer prize-linked savings products. Layup operates in full compliance with this federal law.

Your Money Is Always Safe

The most important thing to understand: your principal is always guaranteed. You never lose your savings by participating in prize drawings. The prizes are funded entirely from interest — not from your deposits.

This is what makes PLSAs different from gambling. With a PLSA, you can never lose money. You can only gain.