New online banks


#1

So I was just reading an article about these new online banks Chime, Empower, etc,. There looking to disrupt the status quo. Wells Fargo, Bank of America, etc,. who charge ridiculous fees and as these new start-ups see it, the time is ripe.

So my question is this. Would you use these new online banks and why and why not? I want to see what other PURISM people think about this?


#2

My first thought is that banks are already being actively disrupted by cryptocurrency, undermining even new banking startups. Of course, success will be based on whether participation passes critical mass.

My second thought is that established banks (e.g. Wells Fargo) have teams of experienced people doing very boring (but crucial) work around internal and external auditing relating to PCI and other regulations. I’m not saying big banks have perfect privacy and security, but having worked at a health care startup, I know that the startup lifestyle revolves around “do first, go fast, ask questions later,” which inevitably leads to a worse posture for your privacy and money. This is worsened if the new bank startup doesn’t have FDIC insurance, because then you really could lose all your money.

I haven’t researched any particular online bank; this is just general wisdom, and may be wrong.


#3

Thank you for your opinion. I’m thinking these new online banks are going to cause a disruption for the old players.


#4

All banks are evil at the moment. We need something different. Blockchain maybe.


#5

Be careful. If these new bank fees are too low to be sustainable, then their business model does not include you as a customer. You are simply data that they collect and sell to someone else. Imagine Google Bank as an fictitious example.