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Hi, cofounder of Simple here. From a regulatory perspective, we're a lot like a prepaid card. It's a well-known model that banking authorities, legal experts,
by al3x 15y ago
Hi, cofounder of Simple here.
From a regulatory perspective, we're a lot like a prepaid card. It's a well-known model that banking authorities, legal experts, and the government is comfortable with. You probably already use financial products that work similarly to the way we do.
That said, we hold ourselves to the same security standards that "real" banks do. I'd like to think we're going above and beyond when it comes to security.
- maaku 15y ago"a lot like a prepaid card" doesn't answer the question. In what ways is it like a prepaid card? In what ways is it not? As the OP asked, where does the money actually go? It's a concern that you couldn't really answer the question.
- ynniv 15y agoI think that you are wrong that this is a concern. HN is not a financial forum, and you are asking for technical details that are irrelevant to the discussion. Simple's statement is that your money is in a third party bank, and Simple promises to be a prudent intermediary.
- AznHisoka 15y agoTo defend the parent, I'm also concerned :)
- ynniv 15y agoMaybe you could provide more detail? Simple appears to be very transparent in what service they provide and where they make their money. I said that HN is not a financial forum not because we aren't curious, but because we aren't informed. It's rather like customers fervently demanding to know which web framework you built your photo sharing website on, because "there was that thing that went bad that time before and like lots of people lost some data". Would it comfort this customer to know that you are using django? Or rails? It's foolish to provide any answer, because at such a high level there are no wrong answers. It's important to be concerned about your money, but let's be reasonable in the technical questions that we demand answers to. As Simple handles money, they are already heavily regulated and bonded, and if anyone doesn't get their money back, it won't be depositors.
- AznHisoka 15y agoLike others have echoed, I just want to know how this really works. Part of the problem of "disruption" is that it creates confusion and breaks the usual pattern of doing things. Noone will sign up for your service if it's just 1 huge black box that is completely foreign and new to them. You will need to educate how it all works... I mean, I still don't know what you guys do, or are.. You're not really a bank, Ok.. that's a start.
- deleted 15y ago[deleted]
- ynniv 15y agoFirstly, I have no affiliation with Simple. But here's my problem with this line of reasoning: even if Simple wrote a detailed description of what they are and how they work, it wouldn't actually help anyone here. Maybe a couple of us have dabbled in something financial, but that doesn't make us qualified to judge whether banking with Simple is a sound financial decision. I don't fix my own medical problems, I don't practice my own law, and I certainly am not going to be my own banker. The best bankers in the world thought that CDO's would be a good (if risky) investment. It's arrogant to think that you can evaluate the financial stability of a financial company by asking a couple of shallow questions on an Internet forum. A couple of people have asked whether their money would be FDIC insured in their name - that's an implementation independent question that actually deserves an answer. Even so, how are any of us understand whether FDIC protection has exploitable loopholes? Let's drop the technical posturing and ask deeper questions that have meaningful answers. Yes, you might have to think before you type.
- scott_s 15y agoHow can people evaluate if they're comfortable using this service without asking these questions? I don't see any technical posturing. And I do see, deep, pointed questions from people interested in the service, but still skeptical about it.
- deleted 15y ago[deleted]
- samstave 15y agoThis is ridiculous: HN is not a financial forum, thus he should be precluded from asking about the details of this startup, who, is trying to brand themselves as a simple banking system based on their technical prowess. Further, you state he is asking technical questions which are irrelevant... how can TECHNICAL questions be irrelevant on HN - especially after you claim he shouldn't be asking financial-forum-esque questions here. What then should he be asking. Personally, you appear to me to be attempting to stifle perfectly relevant questions on HN and trying way to hard to filter commentary rather than add to the discussion. Frankly, I am quite wary of Simple - especially when they state things such as "we are a lot like a prepaid card" -- you know why? Prepaid cards are largely targeted at low income/bad credit users and they pay a premium fee for such use and are bilked as a result. I don't want to think that just because al3x and Simple are posting to HN they should automatically receive my trust. ESPECIALLY given the inherent and complete corruption we know to exist at all levels of banking (if you have not been paying attention this last few years) Simple better make damn sure they set themselves apart. It looks like their business model is "oooh shiny! and we are not a BANK!" That doesn't cut it. If they are simply an abstraction to the known egregious practices of other institutions, then simple needs to be very clear what advantage its customers gain from this model. So far - I see not much gained.
- scott_s 15y agoHuh? Since when have technical details of any kind not been relevant to a discussion on HN?
- ynniv 15y agoRelevant, always. But demanded? We don't always demand to know important details regarding open source NoSQL databases, and that's our area of expertise. Just suggesting that outrage isn't appropriate in this situation.
- scott_s 15y agoIt's not outrage, people just don't understand how this business works. I think people want to know how it works both because they like understanding the inner workings of things, and they won't use it until they're convinced it will work.
- maaku 15y agoIf I am to be giving my money to anyone for safekeeping, I better be damned sure I understand the financial and legal details. Are the FDIC-insured accounts in (Bank)Simple's name? What happens if they go under? Can the creditors of Simple use those deposits to recoup their investment? Now do you see the problem?
- ynniv 15y agoThose are better questions. Perhaps lead with those, rather than trying to deduce the answers yourself.
- steve8918 15y agoThanks Al3x. When you say "we hold ourselves to the same security standards", what does this mean? Are you regulated? Who are your regulators?