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There are no fees at America’s smallest bank

bloomberg.com

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Re: There are no fees at America’s smallest bank

#31

Post by OkayPhysicist »

abdullahkhalids wrote: post #25

How viable is a bank, which offers exactly: * No physical bank branch. Only online banking * a current account with a monthly fee * a debit card that can be used at other banks' ATM - monthly fee. * Debit card can't be directly used online. But you can generate merchant specific card numbers on the website. Say, your monthly fee is $20. Then 4000 customers brings in a million dollars an year. How much is spent on fra…

Why would anyone use such a bank when pretty much every other bank and credit union in existence is cheaper and more convenient?

Re: There are no fees at America’s smallest bank

#32

Post by Arrath »

blakesterz wrote: post #4

Sammons, the fourth generation of his family to run the 100-plus-year-old S&L and its only full-time employee, confides that he’s a bit tech-averse. “Computers are great when they work,” says the 55-year-old, laughing. “I don’t have the patience for them.” Most days I bet most of us would agree with that statement!

Change that to "Computers/Printers" and you'll probably have universal appeal

Re: There are no fees at America’s smallest bank

#33

Post by abdullahkhalids »

V__ wrote: post #30
abdullahkhalids wrote: post #25

How viable is a bank, which offers exactly: * No physical bank branch. Only online banking * a current account with a monthly fee * a debit card that can be used at other banks' ATM - monthly fee. * Debit card can't be directly used online. But you can generate merchant specific card numbers on the website. Say, your monthly fee is $20. Then 4000 customers brings in a million dollars an year. How much is spent on fra…

These sound like direct banks. In Germany, there are a few of those, ING being the largest, and represent about 50% of the private market. Pretty viable therefore.

ING [1] is offering a variety of financial services, including financing and savings accounts. Such banks necessarily have to operate at scale, in order to offset fraud/investment loss. I am specifically asking for the viability of a small "dumb" bank, which engages in only the lowest risk activity.

Surely, technology has reached the point where a small team can create a bank of the sort I am suggesting. But do financial regulations and economic realities allow for it?

[1] https://www-ing-de.translate.goog/?_x_tr_sl=en&_x_tr_tl=ur&_...

Re: There are no fees at America’s smallest bank

#34

Post by adrr »

dimitrios1 wrote: post #13
adrr wrote: post #8

With an aversion to technology, i really wonder how this bank supports electronic transfers like ATM, ACH, wires etc. Is there a core banking system running?

As far as ACH goes, the same way they did it 30+ years ago. You don't need to be technology inclined to perform ACH transactions. NACHA was around in 1974. The ACH network has existed for most of its history without any notion of the modern internet or our current digital world, and most of it still works "offline"

NACHA requires you to upload a formatted file and it's a character offset format that you can't do by hand. There's a computer in the mix. There is also ACH pulls that you need have error handling around for invalid account numbers and insufficient funds. I guess you could just do it by hand.

Re: There are no fees at America’s smallest bank

#35

Post by adrr »

xeromal wrote: post #12
adrr wrote: post #8

With an aversion to technology, i really wonder how this bank supports electronic transfers like ATM, ACH, wires etc. Is there a core banking system running?

The article states they do none of that. Just savings that you can drop off or pick up at the branch.

So fees don't matter if you offer no services.

Re: There are no fees at America’s smallest bank

#36

Post by em-bee »

LoganDark wrote: post #28
iLoveOncall wrote: post #7

I have bank accounts in 3 different countries and none of them have any fees either. What they have thought is redundant documentation of my funds that guarantee I won't be SoL when the building burns down with the paper ledger in it like this bank here. I really don't understand this fascination or even admiration for outdated ways.

> I have bank accounts in 3 different countries How is this even possible? Do you have citizenship in all three countries?

temporary residence or work permit is enough. and you can have that in multiple countries at once.

Re: There are no fees at America’s smallest bank

#37

Post by silisili »

SoftTalker wrote: post #15
blakesterz wrote: post #4

Sammons, the fourth generation of his family to run the 100-plus-year-old S&L and its only full-time employee, confides that he’s a bit tech-averse. “Computers are great when they work,” says the 55-year-old, laughing. “I don’t have the patience for them.” Most days I bet most of us would agree with that statement!

Yep. I was just trying to fill out a PDF form for my taxes. A complete nightmare. Tried three different PDF viewers that had different bugs or incompatibilities with the form. Finally had to start a Windows VM to run Acrobat, that was the only way to get it done, other than print the blank form and fill it out by hand which in retrospect would have saved me about 40 minutes. I have been in software and IT for my whol…

Same. Sometimes my wife asks why I don't play on the computer or social media, and I tell her it's because I hate computers. She expectedly says...but you're a programmer.

I think doing anything all day every day sucks the joy out of it.

Re: There are no fees at America’s smallest bank

#38

Post by kibwen »

> According to Roger Lowenstein, a financial journalist and author of America’s Bank: The Epic Struggle to Create the Federal Reserve, bank regulations used to protect small lenders in particular—in the 1930s you couldn’t have more than one branch or operate across state lines.

I say we bring this back. Split up the "too big to fail" ultrabanks.

Re: There are no fees at America’s smallest bank

#40

Post by V__ »

abdullahkhalids wrote: post #33
V__ wrote: post #30

Earlier quoted context omitted.

These sound like direct banks. In Germany, there are a few of those, ING being the largest, and represent about 50% of the private market. Pretty viable therefore.

ING [1] is offering a variety of financial services, including financing and savings accounts. Such banks necessarily have to operate at scale, in order to offset fraud/investment loss. I am specifically asking for the viability of a small "dumb" bank, which engages in only the lowest risk activity. Surely, technology has reached the point where a small team can create a bank of the sort I am suggesting. But do finan…

I don't think the economies allow for it. The German Sparkasse started as a savings bank and at its core was/is a 'dumb bank' in your words. But at some point customers demand financing etc. and would like to get all their basic needs from one bank instead of having multiple. So these banks adapted.
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