Banks have a license to print money (9 Sep, 2020)

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Banks have a license to print money (9 Sep, 2020)

Postby aardvark_admin » Wed Sep 09, 2020 6:55 am

This column is archived at: https://aardvark.co.nz/daily/2020/0909.shtml

The costs associated with providing banking services have almost certainly fallen significantly since the 1960s so why are those services costing customers so much more?

Is it simply that the owners of those banks are pocketing the benefits of all the cost-savings that technology has produced?

Is this acceptable?

Why is it that the poorest are the hardest hit when it comes to fees, costs and such?

Is it time for some regulation within the banking sector... as Labour seems to be doing with respect to the fees retailers pay for debit card use?
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Re: Banks have a license to print money (9 Sep, 2020)

Postby Ossified Location » Wed Sep 09, 2020 7:41 am

aardvark_admin wrote: Yes, strange as it might seem, all this automation, improvement, cost-cutting, staff reductions and such have not delivered the promised savings for customers. In fact, quite the opposite.
Yes, how strange that CEO's and directors choose to maximise returns to their owners rather than their customers. Unless of course that is what they have been directed to do by those owners...

And that is why I am neither far left or right when it comes to politics.
I've been a civil servant and experienced first hand the altruism and dedication to the public good, but I've also experienced the laziness and inefficiencies. "Quick, spend what is left in your budget, otherwise your budget will be cut next year".
I've worked in the private sector and experienced the constant drive for improvement, but I've also experienced managers slash maintenance budgets and sell off the spare parts, and then award themselves bonuses for being so profitable and move on before the inevitable happens.

So I don't trust either of them with free reign! I think the best system is to have a bob each way, and play them off against each other.
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Re: Banks have a license to print money (9 Sep, 2020)

Postby goosemoose » Wed Sep 09, 2020 8:47 am

Just look at yourselves. Direct debits, Afterpay, credit cards, online banking apps, flash new payment methods, the list goes on and we all want it. Perceived convenience is king. Now banks are giving you all this shit and charging you for it boohoo - you wanted convenience, you got it. Banks have stopped accepting cheques, I still pay by cheque because I can and I find them convenient. People I pay via cheque come to me moaning that their their bank will no longer take cheques, I couldn't care less, find a bank that does, not my problem. You could still use cash but you don't - I've stopped going to get coffee from Mojo because they don't accept cash.

This is why Fintech is a thing these days, clipping the payments ticket, money for old rope. There's a new one popping up every other day and the merchants have to support them all, at a cost of course. I will ask in the shop I'm buying stuff in if it uses services like afterpay etc. I'll then ask for a 5% discount as thats how much these organisations demand in commission, if they don't accept I'll walk away. I'm not going to subsidise these payment parasites.

I realise I'm pissing into the wind here but once it's gone, it's gone and you'll never get it back, you'll be stuck paying higher and higher fees because they can charge you and they will. Of course when the celluar network goes down in a natural disaster and you can't buy toilet paper to hoard because you can't use your apps etc they'll be a outbreak of bleating but there you go. Where's your convenience now? As a side effect my phone is not cluttered with banking and payment apps. Don't get me started on loyalty cards either!
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Re: Banks have a license to print money (9 Sep, 2020)

Postby Perry » Wed Sep 09, 2020 7:42 pm

goosemoose wrote: Banks have stopped accepting cheques, I still pay by cheque because I can and I find them convenient. People I pay via cheque come to me moaning that their their bank will no longer take cheques, I couldn't care less, find a bank that does, not my problem. You could still use cash but you don't . . .

There's another side to that. If no e-payt., or no cash payt, then no product or service from me.

Have you recently tried sending a cheque to the IRD? What's their policy?
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Re: Banks have a license to print money (9 Sep, 2020)

Postby Ossified Location » Wed Sep 09, 2020 9:05 pm

goosemoose wrote:Don't get me started on loyalty cards either!
I'll bite! Here you go, get started...
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Re: Banks have a license to print money (9 Sep, 2020)

Postby patrick » Thu Sep 10, 2020 1:58 am

I suspect it's a lack of competition re fees. In the UK it's as NZ used to be: there are no transaction or ATM fees on accounts and almost all accounts are free - you can pay for some accounts which include mobile phone insurance, travel insurance and so on but take up on these accounts is low.

You don't pay for a new card. You don't pay for a replacement card if you lose one. The only thing I can think of where a fee may be charged is for international money transfers.

With transactions via cards, EU legislation restricts the fees that banks can charge businesses for any form of payment including contactless/paywave - presumably Adern is planning on replicating that - it should have been done a long time ago.
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Re: Banks have a license to print money (9 Sep, 2020)

Postby goosemoose » Thu Sep 10, 2020 6:26 am

Perry wrote:Have you recently tried sending a cheque to the IRD? What's their policy?

I believe, all with out doing research and this is hearsay from accountants from years ago that the IRD can't stop you paying tax so they have to accept your payments. They may not like or actively encourage cheques but they can't refuse. I think if you still send a cheque they will accept it. Grudgingly no doubt.

I'll let you know if I have to pay tax next year, They'll get a cheque.
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Re: Banks have a license to print money (9 Sep, 2020)

Postby greven » Thu Sep 10, 2020 8:15 am

If the NZ banks collaborated to create a simple & free peer to peer payment system similar to WeChat, would you trust it?
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Re: Banks have a license to print money (9 Sep, 2020)

Postby Perry » Fri Sep 11, 2020 9:10 pm

I don't want to unduly be rain on the money-go-round parade, but [private] banks in NZ can not legally "print money."

Only the Reserve Bank of NZ is lawfully allowed to arrange / do that.

But that should not obscure the fact that private banks can 'print' credit.

And the world runs on credit.

No notes or coins allowed, Bits or t'otherwise.
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