The congressionally imposed cap on the interest rate that S&Ls could pay on savings accounts became a serious problem for them in the 1970s when inflation rose.

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As inflation rose in the 1970s, the congressionally imposed cap on the interest rate that S&Ls could pay on savings accounts became a serious problem for them. This is because they could not offer higher interest rates to attract deposits and compete with other financial institutions. As a result, many S&Ls struggled and eventually failed in what became known as the Savings and Loan Crisis.

The Congressionally Imposed Cap on the Interest Rate That S&Ls