Author Topic: WFC - Wells Fargo  (Read 258496 times)

gary17

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Re: WFC - Wells Fargo
« Reply #790 on: Today at 08:20:12 AM »


StubbleJumper

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Re: WFC - Wells Fargo
« Reply #791 on: Today at 09:45:29 AM »
this is the crazy disruption tech that IMO is big risk to banks!
https://www.cnbc.com/2018/12/13/robinhood-goes-after-banks-with-checking-and-savings-accounts.html


I wouldn't bee too worried.  We've had outfits like this in Canada for 20 years and they've barely made any market share.  They are a great alternative for people like me who detest in-person transactions and have mainly simple banking needs.  But, as soon as you get somebody with more complex needs or somebody who likes a little bit of hand-holding, the low-cost low-service model doesn't work.  People like that need a full-service bank.

One of the real head-scratchers for me is that these outfits are not used by more people.  It strikes me as a no-brainer for a large segment of the market that they could invest a few hours of time have their their accounts moved to a no-frills provider and save perhaps $5 or $10 per month for perpetuity.  For the misery of a couple of hours of paperwork, a guy with simple needs might save ~$1,000 in charges over the next 10 years, easy peasy.  But, it seems that banking services are very sticky and people are either content to pay their $10/month in service charges or perhaps they just don't want to think of it (financial stuff is hard, right?).

Over time, however, these entrants exert a bit of discipline on the main players and prevent the worst rapacious treatment of customers.  But whatever.  The major banks in the US are going to improve their automation and downsize their branch network anyway, so that streamlined cost structure will enable lower charges to clients.


SJ

no_free_lunch

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Re: WFC - Wells Fargo
« Reply #792 on: Today at 10:34:12 AM »
I am with you Stubble.  I use a similar service and have found it is an uphill battle getting people to switch.  These institutions hold significant funds on your behalf so trust is a very real issue and the low cost/unknown institution works against them in that regard.

rb

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Re: WFC - Wells Fargo
« Reply #793 on: Today at 10:48:45 AM »
It's not just trust, but doing anything except simple chequing, savings, credit card can become a headache. Try to send or receive a wire or try to get a certified cheque the next day to buy a car. If you ever went through one of these experiences with a low cost bank you'll swear them off. The experience is made exponentially worse by the fact that when you need one of these services you really need it. You're stressed or pressed for time or whatever.

Furthermore, despite being low cost they didn't beat the big banks on rates for credit products, i.e. mortgages.

Spekulatius

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Re: WFC - Wells Fargo
« Reply #794 on: Today at 11:14:04 AM »
I also expect the 3% interest on checking to be a bait sad come with balance limits. Otherwise, people will use it as a money market account. I have a checking account with a credit union that  offers interest on checkin, but only up to 20k balance.
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