[HN Gopher] There are no fees at America's smallest bank
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There are no fees at America's smallest bank
Author : LastNevadan
Score : 66 points
Date : 2023-04-17 08:08 UTC (14 hours ago)
(HTM) web link (www.bloomberg.com)
(TXT) w3m dump (www.bloomberg.com)
| tadfisher wrote:
| I think the regulatory pressure to consolidate is well known by
| the Fed leadership, and they've at least announced a desire to
| protect small institutions and do more to encourage de novo
| institutions[0].
|
| But I disagree with the idea that Dodd-Frank in particular has
| much to do with encouraging smaller banks to consolidate,
| considering its provisions kick in at defined levels of
| capitalization. The practice of "charter stripping", which is
| when fintech/crypto startups purchase a small community bank for
| their Federal banking charter and discard the rest, probably has
| a bit more impact, and that's exactly what relaxing the rules
| against de novo charters would alleviate.
|
| [0]: https://www.bankingdive.com/news/federal-reserve-governor-
| Mi...
| piperswe wrote:
| This may be America's smallest bank, but there are smaller credit
| unions! From what I can tell, Holy Trinity Baptist Federal Credit
| Union is the smallest, operating since 1966 with about $16k in
| deposits according to their EOY 2022 financial report:
| https://ncuso.org/credit-union/17269/financials/
| smelendez wrote:
| Here's an interesting article about church-based credit unions.
| It looks like they exist to offer better options to underbanked
| populations and are often limited to church members:
| https://religionnews.com/2018/10/30/church-run-credit-unions...
| inferiorhuman wrote:
| Credit unions, by law, must have restrictions on who can
| join. Often times they're gated by where you live, what city
| you worship in, where you work. I'm a member of a large
| California based credit union and while the low/no fees are
| nice, their general incompetence is awful.
| sharkweek wrote:
| I'm at a credit union for a chunk of my banking. Their tech
| is bad, but you know what I love?
|
| When I call the number on the back of the debit card a
| human answers the call after a few minutes and 9/10 times
| can fix whatever I need fixed themselves.
| inferiorhuman wrote:
| Oh, it's the humans that are the biggest problem. In
| theory I've got a "password" on my account, in practice I
| think maybe one or two people have asked for it in the
| past decade. I went in to buy a couple rolls of quarters
| the other day... and eventually gave up and got them at
| Wells Fargo (where I'm not a customer) instead.
|
| Their tech... well at least they're not using case
| insensitive passwords anymore.
| massysett wrote:
| The membership restrictions have been watered down a lot.
| Anyone can join PenFed. There are others that require a
| token donation to an associated foundation.
|
| I have been in more than one credit union and found they
| were just as bad as banks when it came to ridiculous fees.
| I therefore prefer the huge commercial bank as it is much
| more convenient.
| eltondegeneres wrote:
| There's a nice documentary from 2002 about Germany's smallest
| bank, which also doesn't use computers:
| https://de.wikipedia.org/wiki/Schotter_wie_Heu
| iLoveOncall wrote:
| 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.
| michaelhoffman wrote:
| The old-school way to document savings accounts is with a
| passbook:
|
| https://en.wikipedia.org/wiki/Passbook
|
| If this bank offers that, then you have the redundant
| documentation yourself.
| linksnapzz wrote:
| I'm sure Mr. Sammon's typist keeps the pink copy of the carbon
| with your account data on it offsite.
|
| Many of this bank's customers would be baffled at the necessity
| of having bank accounts in three different countries. They
| haven't left Newton County, Indiana since high school.
| LoganDark wrote:
| > I have bank accounts in 3 different countries
|
| How is this even possible? Do you have citizenship in all three
| countries?
| rendx wrote:
| If you reside in the European Union, you can easily have bank
| accounts in any other EU country. Apart from that, plenty of
| banks in many countries allow you to open an account even
| without residency or citizenship.
| em-bee wrote:
| temporary residence or work permit is enough. and you can
| have that in multiple countries at once.
| iLoveOncall wrote:
| I have lived and worked in 3 countries and have kept the bank
| accounts I opened there since. They usually won't allow you
| to open a new bank account without being a resident, but you
| can notify them of your new tax residency once you move out
| and keep your account, credit cards, etc.
|
| I could have more if I had kept the account I had when
| studying abroad but it had fees to keep it while empty.
|
| Actually with Revolut I have also an account domiciled in
| Lithuania.
| tmountain wrote:
| How many mortgages can they service with 3M in assets? Seems like
| they'd be very limited in that regard.
| adamredwoods wrote:
| In the US, originator mortgages get sold to other banks, who
| then can wait 30 years for repayment. For example, Fannie Mae.
|
| https://www.fanniemae.com/about-us
| goodcanadian wrote:
| From the article:
|
| _There are currently only 40 or so mortgages outstanding, and
| as customers pass away, the stock is not being replenished with
| loans to younger generations, who have no particular affinity
| for in-person banking._
| tmountain wrote:
| The realest form of attrition...
| AdamJacobMuller wrote:
| https://archive.is/jfRGB
| adrr wrote:
| 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?
| Kerrick wrote:
| It seems not to support ATMs, as mentioned in the large sub-
| heading (the "deck" as it's known in news parlance).
|
| > There's no ATM, no website and constant worries about being
| "too small to survive."
| deathanatos wrote:
| There are multiple ways to read that: as a bank, you can have
| no ATMs, but still allow your customers to withdraw money via
| other banks' ATMs, though there is almost always a fee for
| this. (But I can even see one still claiming "no fees at
| _this_ bank ", as the fee could be assessed by the ATM-owning
| bank.)
| humanistbot wrote:
| > Is there a core banking system running?
|
| The Minimum Viable Bank System is a paper ledger, paper Know
| Your Customer records, and cash in a locked container. You
| don't have to support electronic transfers or even paper
| checks. Just let people withdraw and deposit in-person at the
| only physical office.
| [deleted]
| xeromal wrote:
| The article states they do none of that. Just savings that you
| can drop off or pick up at the branch.
| adrr wrote:
| So fees don't matter if you offer no services.
| xeromal wrote:
| The service is your money being safer than under the
| mattress. They also make home loans.
| moffkalast wrote:
| Well you are trusting someone else with it, that doesn't
| sound much safer.
| xeromal wrote:
| It's FDIC insured and regulated.
| kibwen wrote:
| And vice versa, for some.
| dimitrios1 wrote:
| 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"
| adrr wrote:
| 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.
| [deleted]
| abdullahkhalids wrote:
| 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 fraud by a bank
| every year?
|
| Could a single person with a few part-time contractors run a bank
| of this nature?
| V__ wrote:
| 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.
| abdullahkhalids wrote:
| 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&_...
| inferiorhuman wrote:
| ING, when they had US retail banking operations, wasn't
| huge but they also did things differently. For instance
| they did not offer fixed rate mortgages - it's a lot easier
| to keep an adjustable loan on the books. They also did tech
| better than most banks (until the dumpster fire that is
| Capital One bought them out).
| V__ wrote:
| 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.
| OkayPhysicist wrote:
| Why would anyone use such a bank when pretty much every other
| bank and credit union in existence is cheaper and more
| convenient?
| notahacker wrote:
| I don't think a single person with a few part-time contractors
| is getting a banking licence in many jurisdictions
|
| The UK has a few "challenger bank" startups which are basically
| just an app, but they're not lifestyle businesses, they're
| "raise PS10m before you launch" businesses.
| jermaustin1 wrote:
| This is kind of how I'm set up. I use Ally for their checking
| and savings and privacy for their merchant specific card
| numbers. It works reasonably well for me.
|
| It would be cool to have a real FDIC insured, licensed bank
| with this built in some how. I'd be willing to pay $25/mo for
| something that is first-party.
| popcalc wrote:
| Relay (Thread Bank) offers generating virtual cards.
| tgsovlerkhgsel wrote:
| Good luck developing all the software and infrastructure needed
| for online banking, card processing, all the compliance
| paperwork, etc. with just a million per year.
|
| Remember that any time something with your online banking goes
| wrong it turns into a customer support call, which isn't just
| frustrating for the customer but also expensive for you.
|
| Also, why would I bank with a bank with hacky online banking
| that charges me $240/year when I can have the same for free at
| one of the many fintechs?
|
| > Could a single person with a few part-time contractors run a
| bank of this nature?
|
| You have 4000 customers. If each of them has one customer
| support contact per year (your website better work well!)
| that's 11 calls per day or ~20 per working day.
| kibwen wrote:
| _> 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.
| blakesterz wrote:
| 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!
| SoftTalker wrote:
| 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 whole career and I
| absolutely hate computers now. I want nothing to do with them
| when I retire, and I'm going to deliberately structure my life
| accordingly.
| dangerlibrary wrote:
| I've had decent luck with Xournal's "Annotate PDF" feature.
|
| It's not really interacting with the PDF form at all, so if
| the form is at all complicated it'd be a waste of your time.
| But, if you just need to "sign" something by dropping a
| transparent PNG on a line at the bottom and typing in a date,
| it's perfect.
| rendx wrote:
| Master PDF Editor is the only proprietary software I use on
| my machine, and it's well worth the license fee.
|
| https://code-industry.net/free-pdf-editor/ (free trial)
| scrollaway wrote:
| Same! This is a hell of a piece of software. It's fast and
| very easy to use, and it single-handedly makes you think
| PDFs are obvious and super simple. Which, knowing the
| truth, just blows my mind.
|
| Using Master PDF editor is like watching a 60 second
| youtube physics video that's so good, you just understand
| quantum physics perfectly by the end of it.
| silisili wrote:
| 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.
| nebula8804 wrote:
| Sounds like you are purposely making your life worse by using
| something like Linux. Don't blame the machine when it is
| running poorly tested software that likely did not consider
| UX.
|
| Have you tried using a Mac full time? It lacks the ad-
| bloatware of Windows 11 while still retaining some POSIX
| compatibility.
| andrepd wrote:
| I've used Mac, Windows 10, and Linux (KDE and Cinnamon).
| Linux has been an infinitely more pleasant experience.
| Arrath wrote:
| Change that to "Computers/Printers" and you'll probably have
| universal appeal
| latchkey wrote:
| Half the time when my computer doesn't "work" it is because I
| am using it to deal with outdated banks and credit cards.
| Today, I was trying to pay 2 parking tickets. First one went
| through just fine. Second one failed with invalid zip code,
| even though I was using the same one. Turns out that since I
| have different mailing and billing addresses, it was randomly
| picking the one to use.
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