191–200 of 258 posts
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I'm pretty sure that whoever disrupts banking will do it the Uber way, by disregarding all the laws that they are required to follow and trying to claim not to be what they actually are, with the same eventual success this route has had for Uber.
Uber is succeeding? Its finances don't think so.
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So curious how he banks there make money?
For individual mass market the big driver is loan margins, both for home mortgages and various short-term loans. But the improvement in payments was mostly driven by legislation (e.g. the Payment Services Directive from 2007 with most of implementation at 2012) without which banks were quite happy to offer payments as slow and expensive as they could as it was too profitable for the industry to voluntarily agree to d…
They sell insurance and offer consumer investment accounts -- which are not permitted for us citizens!
Another answer: because regular banks are awful to deal with. They don't have nice APIs to just move money around. They apply velocity limits at surprising times. They can terminate your account suddenly for opaque reasons. They charge high regular fees and even higher "gotcha" fees if you make a mistake. They can take back money sent to you for up to 90 days, but often can't get back money you sent to crooks even if…
This 100%. I work at a fintech that's not a bank. Instead, we integrate with people who integrate with banks--we've basically got one middleman per continent (except a few). It's awful. Rather than having to figure out the regulatory details of each jurisdiction so that we can be compliant, we instead have to figure out the regulatory details of each jurisdiction so that we can trick whichever middleman into being co…
I am sure there are exceptions, but my point is if you talk to someone who understand what is going on in a bank, you would be extremely lucky that this person also can code.
This is slowly changing as I see an increasing number of junior bankers who are also interested in picking up coding skills. They won’t be developers per se but will certainly become technically literate interlocutors. But it will take some time.
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Isn’t access to that financial data extremely well regulated? I’ve often thought of launching a credit card company solely for access to people’s transaction data. That provides tremendous insight into many companies turnovers allowing to anticipate earnings.
Not regulated well enough, imo, MasterCard is already willing to sell data to these same actors: https://www.theverge.com/2018/8/30/17801880/google-mastercar...
Shockingly enough, people don't care enough to shred all their credit cards! Even people who tend to get outraged on the internet about these sorts of things still have, and use at least one.
(And before someone brings up that EU is not heavy on credit cards - the function of European debit cards in this space is not one whit different from that of a credit card.)
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Does Fidelity allow you to deposit cash?
"Integrated cash management" (a debit card, etc) is abundantly available from discount brokerages, and is systemically important to their businesses. Fidelity legally can't call it a checking account so they call it a Cash Management Account; brokerages that own banks (Schwab, etc) just call it checking.
The basic "fintech" startup theory is fairly reasonable:
(1) financial services have a lot of fat and/or profit.
(2) financial services is/should be a tech subsector. Debit/credit cards, current accounts & such are nearly commodities, one is as good as another. Apart from customer service, UX is all that differentiates them^, from a meaningful subset of customers. That's software.
(3) The competition is soft. Many banks have terrible consumer facing software, for example. Many have costly legacy structures.
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The traditional banking system is about 150 years old by now. Increasingly, it seems to serve a smaller segment of society, regardless of its half-hearted attempts at innovation. I have a number of friends working in finance. Lovely people. Absolutely arrogant, though, when it comes to the question of whether their industry will face non-trivial disuption. Maybe Google and other current tech giants will not be the on…
I'm pretty sure that whoever disrupts banking will do it the Uber way, by disregarding all the laws that they are required to follow and trying to claim not to be what they actually are, with the same eventual success this route has had for Uber.
Local transportation violations aren't enforced in quite the same way.
Banks usually make a shitload of money, I guess.
Another answer: because regular banks are awful to deal with. They don't have nice APIs to just move money around. They apply velocity limits at surprising times. They can terminate your account suddenly for opaque reasons. They charge high regular fees and even higher "gotcha" fees if you make a mistake. They can take back money sent to you for up to 90 days, but often can't get back money you sent to crooks even if…
This happens more often with "bank" startups than with old, boring, regular ones.