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That's about a 2% fee which doesn't seem out of line with other transaction processing fees that are out there. That fee probably has built in insurance for fra
by eezurr 6y ago
That's about a 2% fee which doesn't seem out of line with other transaction processing fees that are out there. That fee probably has built in insurance for fraud and other failures. And also the cost of the transaction. I bet that fee is the same fee as a year ago?
- AndrewKemendo 6y agoThat's exactly it. In effect it cost 2% to use the banking system to complete this transaction. With these kinds of insane numbers ($350B!) even tiny percentages are huge.
- solarhoma 6y agoYes but these fees are huge with larger loans. Why are the fees percent based rather then flat rate? The banks giving out these loans are not taking on any risk with the loan. So how are they getting away with large fees associated with the loans?
- eezurr 6y agoBecause successful fraud takes everything.
- ric2b 6y agoNot from the bank, they just roll back the transaction. Some merchant might end up on the hook, though.
- burmer 6y agoIf the money is to mitigate risk, then why can't the fee be (mostly) refundable? The bank takes on the risk of processing some enormous transaction and takes a percentages of the transaction as insurance in case of fraud. Then after a period of time with no issues, the money flows back, less some nominal amount for the actual work involved processing the transaction.
- gadders 6y agoDoctors aren't working for free, so I'm not sure why bank employees are expected to.
- vernie 6y agoActually this is normal and good.
- adrr 6y agoWe are back stopping the banks from failing by buying their distressed assets, changing the fdic holding requirements, helping out with overnight lending rates etc. They shouldn't be charging any fee.
- jhwang5 6y agoThis is the wrong way to think about it. Rates are nearly negative, so 2% is practically 10, 100X the rates banks can earn otherwise. It's basically free money shoveled into banks, a massive boon.
- bmelton 6y agoGenuinely curious how federal interest rates have any relation whatsoever to fees for service and why they're being correlated here. An uncharitable reading might assume a spurious correlation.
- _curious_ 6y ago"It's basically free money shoveled into banks, a massive boon." A wall street bailout disguised as a main street bailout.
- imtringued 6y agoBank fees are added on top of the market rate. If the rate is -1% and the bank demands a 2% fee then you will have a 1% interest rate.
- deleted 6y ago[deleted]
- mihaaly 6y agoI do not feel the 'business as usual' a valid argument here!
- JSavageOne 6y agoWhy is a 2% fee acceptable on money being given to the public during a crisis? Why can't the government just give the money directly to businesses without some middleman extracting a 2% fee? Boggles my mind that anyone jumps to defend the banks in this scenario for what effectively amounts to a racket.