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You do realize all those things COST banks money in the past right? some 30+ years ago, when banks were on COBOL mostly, the system analysts would try to lower

by gcbw2 8y ago

You do realize all those things COST banks money in the past right? some 30+ years ago, when banks were on COBOL mostly, the system analysts would try to lower costs because you couldn't charge a fee, and if you didn't provide services that cost the bank money, the clients would move to your competition. In that time, banks had the concept of Client Acquisition Cost. Today banks uses fee for everything and everyone is ok with that, so they now have the concept of Recurring Fee Profit Per Customer. If you don't pay many fees, they treat you like garbage. So yes, it is very possible to make a profit by not only having those things but having that without fees. You will just have a harder time getting institutional investors because now they will only ever invest in predatory banks because they provide a return much faster.

pebers 8y ago
> Today banks uses fee for everything and everyone is ok with that They actually don't. Most ATM fees and inter-bank payments (at least in the UK / Europe) are swallowed by the banks rather than exposed to customers. > So yes, it is very possible to make a profit by not only having those things but having that without fees. How? As far as I can tell you're describing a bank that runs deposit accounts but doesn't loan the money back - that is not obviously a profitable enterprise. Something in the whole scheme has to make some money to pay for the employees, the infrastructure, and all the other fixed costs.
- cryoshon 8y ago
  maybe by buying inflation indexed bonds on a rolling basis. nab something like 1-2% interest on the customers' money in an extremely safe investment vehicle, then return most of that to the customer after paying off infrastructure costs. (does this work? i have no idea whatsoever)
- gcbw2 8y ago
  AH, Europe. In the US you pay around $1.5 to $4 per withdraw, because the ATM network is a private enterprise not owned by the banks. You will get there, unfortunately. And you completely missed the point. Loaning/re-investing with volume is a very sure way to make money, and was what banks used 30+ years ago. now they pad it with fees for everything.
  - pebers 8y ago
    The ATM network here is also not owned by the banks (similarly FASTER payments, they are members of the scheme but there's a third-party that administers the network). They pay for access, but don't pass that cost on. And I did not miss that point, thank you. I just disagree with it. I don't think banks make their primary income from fees; current accounts are still basically a loss leader.

by gcbw2 8y ago

pebers 8y ago

> Today banks uses fee for everything and everyone is ok with that They actually don't. Most ATM fees and inter-bank payments (at least in the UK / Europe) are swallowed by the banks rather than exposed to customers. > So yes, it is very possible to make a profit by not only having those things but having that without fees. How? As far as I can tell you're describing a bank that runs deposit accounts but doesn't loan the money back - that is not obviously a profitable enterprise. Something in the whole scheme has to make some money to pay for the employees, the infrastructure, and all the other fixed costs.

cryoshon 8y ago
maybe by buying inflation indexed bonds on a rolling basis. nab something like 1-2% interest on the customers' money in an extremely safe investment vehicle, then return most of that to the customer after paying off infrastructure costs. (does this work? i have no idea whatsoever)
gcbw2 8y ago
AH, Europe. In the US you pay around $1.5 to $4 per withdraw, because the ATM network is a private enterprise not owned by the banks. You will get there, unfortunately. And you completely missed the point. Loaning/re-investing with volume is a very sure way to make money, and was what banks used 30+ years ago. now they pad it with fees for everything.
- pebers 8y ago
  The ATM network here is also not owned by the banks (similarly FASTER payments, they are members of the scheme but there's a third-party that administers the network). They pay for access, but don't pass that cost on. And I did not miss that point, thank you. I just disagree with it. I don't think banks make their primary income from fees; current accounts are still basically a loss leader.