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Simple Banking

May 27, 2010 5 comments

There was a Twitter conversation earlier today about a Fast Company article that discussed Mint.com and BankSimple.  The article centered on “banking that doesn’t suck”.  Ron Shevlin’s post Banking Is Not A Technology Business is a great response to that article.  I’d also like to add my $1.25 banker’s fee.

Ron makes a great point that banking is a service business that leverages technology.  Working in IT for a bank, I can definitely confirm that.  But I really took offense to Alex Payne’s quote in the article:

“Imagine, for a moment, a bank that doesn’t suck, a bank that doesn’t gouge you with fees. A bank that doesn’t treat you like crap. A bank that cares about design, but gets out of your way. A bank that puts your money to work automatically. A bank that’s building a platform for the future of personal finance.”

Now, why in the world would you do business with someone that sucks?  Since most of us live in an area with plenty of banks and credit unions, moving our money isn’t that much of a problem.  As for fees, those are completely avoidable.  Banks will typically waive the occasional “oops” on an overdraft.  You can also avoid those pesky ATM fees by using an in network ATM.  As for design and platforms, unfortunately banks are at the mercy of their vendors.  They just don’t have the expertise in-house, unless they’re typically a top 50 bank.

That being said, I think BankSimple has the potential of being very successful.  They will really appeal to people that embrace online tools for managing their money.  And honestly, if I were starting a bank, I’d go the same route of leveraging technology and building from the ground up.  Not having to worry about the extra expense of branches is one less major headache.  Whether they can pull it off remains to be seen.  Like Ron said, at the end of the day, it’s all about service.

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