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They're a bank. Banks have been profitable for hundreds of years. It's not the business model that's being innovated here, it's the execution.
by greysteil 7y ago
They're a bank. Banks have been profitable for hundreds of years. It's not the business model that's being innovated here, it's the execution.
- raesene9 7y agoyeah the question is though, can retail banking be profitable enough to satisfy VC like return levels... Retail banking whilst profitable (if done right) isn't wildly profitable, so the only way to rapidly ramp overall profits is to expand the customer base very rapidly, which is difficult as each new market you enter has different regulatory setups which require time/money to adapt to. Also customers (even in countries with good bank transfer laws) are not that mobile in their banking requirements (in many cases), so growing quickly enough can be tricky.