Is it possible to borrow money to accrue interest, and then use that interest to pay back the borrower + fees?
There are many flaws with your idea. Say I want to borrow $225,000.00 to accrue interest on a 1.20% APY   account. I promise ... that I cannot withdraw nor touch the   account by legal contract. If you break the contract and lose the money, the lender is out the money. They can take you to court and will win, but if you don't have the money, then they don't get paid. (You can't squeeze water out of a rock even if a judge orders you to.) By sharing the interest with me on a loan, they keep a percentage that they'd normally get... If you're "investing" the money at 1.2%, and the lender gets some amount less than that, then they are getting much less than they "normally" get. Lenders typically get somewhere from 5-15% on loans. The money can also be used to fund a stock/trading account. Regardless of whether I profit, I pay interest on the loan and split the profit shares 24/7. How can the lender lose with legal enforcing? Again, if you lose the money, no amount of legal enforcing can force you to pay money that you don't have. Even if you go to jail for fraud the lender still doesn't get paid. Simply, no bank would ever agree to this.