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I wonder sometimes what is left for banks to do that couldn't be fully automated (at least on the consumer side). Creating accounts, making deposits, withdrawal

by rndmize 12y ago

I wonder sometimes what is left for banks to do that couldn't be fully automated (at least on the consumer side). Creating accounts, making deposits, withdrawals, transfers, paying bills can all be done online or through apps. Getting a loan or credit card seems to largely be a matter of 1) obtain credit score 2) calculate terms. Investments can be done through the likes of Vanguard/Wealthfront/Betterment. I feel like I must be missing something here, or maybe people really like talking with someone they know at the bank when getting a loan or mortgage.

mrfollicle 12y ago
Agreed. At least from a consumer standpoint. I use an online only bank account after switching. And there's plenty out there. Better service, fewer fees, and without a physical "bank" location in the traditional sense it can keep costs lower. Haven't looked back. I don't need a physical bank to accomplish 99.9% of my banking needs. With offerings like Ally, Simple, etc I think the traditional and big banks will only be necessary for non consumer facing stuff: large investments, mass ACH, trading (including high frequency stuff), etc
- fluxquanta 12y ago
  I was nervous before switching to Simple, but then I thought about how the only time I went to my physical bank in the last 3 years was to exchange currency, and in that time they charged me $300 in fees for one reason or another. It's been almost a year with zero fees and zero regrets.
  - jjulius 12y ago
    I've been using Simple since January of last year, and I am incredibly thrilled with them overall. I could ramble for days about their outstanding customer service, how their "Goals" system has significantly improved my own ability to save money, yadda yadda. Chase was the bank I had to suffer with prior to switching to Simple, so I have to admit that it makes me ridiculously happy to see Dimon legitimately concerned about companies that actually give a fuck about people.
runeks 12y ago
Banks are primarily market makers in the credit market. They borrow money (via deposits) and lend it out, earning money on the spread. If you want to earn a yield on your deposit, the bank will have to invest deposits, and this is not a simple process. Each investment requires separate handling, where the bank bases its offer price on the risks associated with that particular project. I'm not saying it can't benefit from some sort of automation, only that it's a non-trivial task, not easily automated. This is traditionally what banks do. Of course, if the debtors-to-be can get better conditions elsewhere -- like a zero interest loan from Kickstarter -- they will go there. But as long as people want to earn interest on their savings, there is a place for banks.

by rndmize 12y ago

mrfollicle 12y ago

Agreed. At least from a consumer standpoint. I use an online only bank account after switching. And there's plenty out there. Better service, fewer fees, and without a physical "bank" location in the traditional sense it can keep costs lower. Haven't looked back. I don't need a physical bank to accomplish 99.9% of my banking needs. With offerings like Ally, Simple, etc I think the traditional and big banks will only be necessary for non consumer facing stuff: large investments, mass ACH, trading (including high frequency stuff), etc

fluxquanta 12y ago
I was nervous before switching to Simple, but then I thought about how the only time I went to my physical bank in the last 3 years was to exchange currency, and in that time they charged me $300 in fees for one reason or another. It's been almost a year with zero fees and zero regrets.
- jjulius 12y ago
  I've been using Simple since January of last year, and I am incredibly thrilled with them overall. I could ramble for days about their outstanding customer service, how their "Goals" system has significantly improved my own ability to save money, yadda yadda. Chase was the bank I had to suffer with prior to switching to Simple, so I have to admit that it makes me ridiculously happy to see Dimon legitimately concerned about companies that actually give a fuck about people.

runeks 12y ago

Banks are primarily market makers in the credit market. They borrow money (via deposits) and lend it out, earning money on the spread. If you want to earn a yield on your deposit, the bank will have to invest deposits, and this is not a simple process. Each investment requires separate handling, where the bank bases its offer price on the risks associated with that particular project. I'm not saying it can't benefit from some sort of automation, only that it's a non-trivial task, not easily automated. This is traditionally what banks do. Of course, if the debtors-to-be can get better conditions elsewhere -- like a zero interest loan from Kickstarter -- they will go there. But as long as people want to earn interest on their savings, there is a place for banks.