[AnthonyMouse]

Suppose you take your $5000 in cash into the bank and deposit it. They put the cash in their vault and credit your account with $5000. Now they have 100% reserves.

Alice, Bob and Carol come into the bank and each take out a $5000 loan. The bank credits each of their accounts with $5000, but there is still only $5000 in their vault, so now they have 25% reserves. As long as the reserve requirement is below 25%, this is fine. If the reserve requirement was 30%, they couldn't make that many loans.

With a 0% reserve requirement, they could loan your $5000 to a million different people and have 0.000001% reserves and still be allowed because 0.000001% is more than 0%. They could send you away and the bank manager could deposit a dollar and they could make unlimited loans from it. They have no use for your money.

[Doingmything123]

Ah, so reading up on this, it really is unintuitive. I guess the only worry then is if this will bite tax payers. Thanks for the expanation