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That is nifty but I think Mint's model looks better on paper. They want to operate in the transaction/opportunity cost of switching financial services. Banks ha

by joez 17y ago

That is nifty but I think Mint's model looks better on paper. They want to operate in the transaction/opportunity cost of switching financial services. Banks have transaction costs (marketing fees, referral fees to other institutions, brick and mortar fees) and consumers have have opportunity costs (analysis paralysis, etc). By lowering these costs, they are creating wealth and taking a piece of it. I think this sounds better (at least on paper) because you are both the friend of the consumer and the institution. In your model, the institution becomes more or less the enemy. Actually, since you (Mint 2.0) are trying to unite consumers against the bank, the bank will just shut your site down by not blocking access to the consumer's transactional data.

mediaman 17y ago
I disagree that the institution becomes the enemy: what is really happening is that a portion of the fee Mint earns from a referral is being given the consumer, in the form of higher interest or some other perk. By grouping multiple customers together, Mint is further reducing transaction costs for the bank, so that it may become economic for Mint to give some of the rewards to the consumers, in the form of higher interest (Mint earns less because the bank will have to pay Mint less to make up for the better deal to the consumers). If this allows Mint to generate enough leads, the smaller fee may be made up by an increase in volume.
- arfrank 17y ago
  I agree with you that the institution does not become the enemy. I had always envisioned in my head as by bringing in customers to a bank that bank gains leverage too. So say you bring an extra 1 mil in savings accounts to a small bank, that bank now has X times as much to lend out as credit/leverage. Same goes for mortgages.
- joez 17y ago
  Okay, I can see if from this perspective. The way I originally understood it was more from an aggregation of power into the hands of the consumer. By banding together they would be able to leverage a better rate. In that sense I would see the bank as becoming a common enemy (probably a poor choice of wording too). This is an interesting model in that Mint becomes the preferred provider or discount broker or something along those lines.

by joez 17y ago

mediaman 17y ago

I disagree that the institution becomes the enemy: what is really happening is that a portion of the fee Mint earns from a referral is being given the consumer, in the form of higher interest or some other perk. By grouping multiple customers together, Mint is further reducing transaction costs for the bank, so that it may become economic for Mint to give some of the rewards to the consumers, in the form of higher interest (Mint earns less because the bank will have to pay Mint less to make up for the better deal to the consumers). If this allows Mint to generate enough leads, the smaller fee may be made up by an increase in volume.

arfrank 17y ago
I agree with you that the institution does not become the enemy. I had always envisioned in my head as by bringing in customers to a bank that bank gains leverage too. So say you bring an extra 1 mil in savings accounts to a small bank, that bank now has X times as much to lend out as credit/leverage. Same goes for mortgages.
joez 17y ago
Okay, I can see if from this perspective. The way I originally understood it was more from an aggregation of power into the hands of the consumer. By banding together they would be able to leverage a better rate. In that sense I would see the bank as becoming a common enemy (probably a poor choice of wording too). This is an interesting model in that Mint becomes the preferred provider or discount broker or something along those lines.