There is some brutal competition for retail deposits right now and I think the banks are getting sophisticated about balancing interest rates and consumers’ who satisfice versus those who optimize. They can probably afford to lose the latter.
-
Show this thread
-
There have been higher-yielding options for retail for at least 25 years now but I think mobile banking substantially changes the game, because there was previously some friction in getting money in and getting it out, and now it’s single digit taps on your always-on computer.
3 replies 0 retweets 13 likesShow this thread -
I wonder who decides to give this away (to the extent that regulators will let them)? Maybe Wealthfront? Capital One, Marcus (Goldman Sachs), Ally, Amex, and at least a few others all have options here, but Wealthfront and maybe Robinhood seem to be indifferent to net interest.
4 replies 1 retweet 14 likesShow this thread -
Replying to @patio11
I don’t understand the retail deposit business. With rates and vol so low, who has any cash at all on hand?
1 reply 0 retweets 0 likes -
Replying to @kchoudhu
Boomers and yuppies, but broadly speaking the American middle class at any given time has a lot of cash and is not very aggressive about optimizing it. This is a perinneal low-cost source of deposits for banks.
2 replies 0 retweets 0 likes -
Do you think mobile banks a good optimization solution, or is there something better?
1 reply 0 retweets 0 likes
From user’s perspective or from hypothetical entrepreneur’s perspective? I think most consumers of banking services who’d take advice from me would get most of the juice for very little squeeze by getting one bank with a competitive rate and a mobile app, yeah. Punt on #2.
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.