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This is why I loved Simple Bank so much. No such fees; too bad they are shutting down.

by meling 6y ago

ddalex 6y ago
Perhaps that's why they are shutting down?
- yurishimo 6y ago
  No, they’re shutting down because their parent bank got bought by a bigger bank who likely wants the tech/team for something else.
- hkt 6y ago
  I've no experience with the bank named and assume it is in the US, but for what it is worth, in the UK people hardly ever pay for bank accounts. It does appear to be viable, although I'm not sure how it works.
  - OJFord 6y ago
    Revenue from account fees must be peanuts, they make their money lending/investing/etc. deposits, in normal times interest rates are positive, so they might even pay for custom, getting more deposits, giving them more capital to make their money from. Charging for bank accounts in North America is just like commission on retail brokers - everyone else is doing it, so why not? Eventually probably 'fintech startup challenger banks' with the novel idea of not charging will gain too much market share, and the big boys will scrap the fees too in order to compete (and barely feel it).
    - technothrasher 6y ago
      The big US banks each make over $1.5B in overdraft fees yearly. Fees on consumer accounts make up about 3-4% of the big banks annual income. Not as much as they make on consumer interest payments, but those are still some pretty big peanuts. I think they'd feel it if they scrapped fees. https://money.cnn.com/2017/02/22/investing/atm-overdraft-fees-rise/index.html https://money.cnn.com/2017/02/22/investing/atm-overdraft-fee... https://www.depositaccounts.com/blog/banks-income-fees.html https://www.depositaccounts.com/blog/banks-income-fees.html
  - jsmith99 6y ago
    It's subsidised by eye watering fees on unarranged overdrafts. When the FCA and CMA looked into it several years ago, the banks claimed they couldn't reduce overdraft fees or they wouldn't be able to afford to offer free bank accounts any more. Some challenger banks wanted it to be forbidden to describe such accounts as 'free'. https://www.google.com/amp/s/amp.theguardian.com/business/2016/may/17/overdrafts-costs-to-fall-as-part-of-overhaul-of-uk-banks-cma https://www.google.com/amp/s/amp.theguardian.com/business/20...
    - hkt 6y ago
      Fascinating link, thank you!

This is why I loved Simple Bank so much. No such fees; too bad they are shutting down.

by meling 6y ago

This is why I loved Simple Bank so much. No such fees; too bad they are shutting down.

ddalex 6y ago

Perhaps that's why they are shutting down?

yurishimo 6y ago
No, they’re shutting down because their parent bank got bought by a bigger bank who likely wants the tech/team for something else.
hkt 6y ago
I've no experience with the bank named and assume it is in the US, but for what it is worth, in the UK people hardly ever pay for bank accounts. It does appear to be viable, although I'm not sure how it works.
- OJFord 6y ago
  Revenue from account fees must be peanuts, they make their money lending/investing/etc. deposits, in normal times interest rates are positive, so they might even pay for custom, getting more deposits, giving them more capital to make their money from. Charging for bank accounts in North America is just like commission on retail brokers - everyone else is doing it, so why not? Eventually probably 'fintech startup challenger banks' with the novel idea of not charging will gain too much market share, and the big boys will scrap the fees too in order to compete (and barely feel it).
  - technothrasher 6y ago
    The big US banks each make over $1.5B in overdraft fees yearly. Fees on consumer accounts make up about 3-4% of the big banks annual income. Not as much as they make on consumer interest payments, but those are still some pretty big peanuts. I think they'd feel it if they scrapped fees. https://money.cnn.com/2017/02/22/investing/atm-overdraft-fees-rise/index.html https://money.cnn.com/2017/02/22/investing/atm-overdraft-fee... https://www.depositaccounts.com/blog/banks-income-fees.html https://www.depositaccounts.com/blog/banks-income-fees.html
- jsmith99 6y ago
  It's subsidised by eye watering fees on unarranged overdrafts. When the FCA and CMA looked into it several years ago, the banks claimed they couldn't reduce overdraft fees or they wouldn't be able to afford to offer free bank accounts any more. Some challenger banks wanted it to be forbidden to describe such accounts as 'free'. https://www.google.com/amp/s/amp.theguardian.com/business/2016/may/17/overdrafts-costs-to-fall-as-part-of-overhaul-of-uk-banks-cma https://www.google.com/amp/s/amp.theguardian.com/business/20...
  - hkt 6y ago
    Fascinating link, thank you!