{"id":179585,"date":"2017-12-25T19:51:00","date_gmt":"2017-12-26T00:51:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2017\/12\/25\/one-can-only-hope\/"},"modified":"2017-12-25T19:51:00","modified_gmt":"2017-12-26T00:51:00","slug":"one-can-only-hope","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2017\/12\/25\/one-can-only-hope\/","title":{"rendered":"One Can Only Hope"},"content":{"rendered":"<p>Could someone explain to me why <a href=\"http:\/\/blogs.lse.ac.uk\/businessreview\/2017\/10\/31\/edward-george-banks-are-in-danger-of-becoming-utilities\/\">banks becoming utilities<\/a> is a bad thing?<\/p>\n<p>The head of Ecobank in the UK, Edward George is filled with dread at the prospect.<\/p>\n<p>The idea of this happening fills me with hope:<\/p>\n<blockquote><p><span style=\"color: blue;\">\u2026\u2026\u2026<\/span><br \/><span style=\"color: blue;\"><br \/><\/span><span style=\"color: blue;\">Well, one of the big challenges facing banks is that they\u2019re in danger of becoming utilities. The big problem about utilities and why a lot of people don\u2019t want to invest in them is that they have no real growth potential. With a utility, you start providing service over a certain network and you\u2019re kind of stuck there. Where\u2019s the value at? And the problem for the banks would be if the banks become somehow passive repositories of cash but all of the value-add is taken by the Fintechs: selling the service, paying interest here, making a margin here, left, right and centre, etc\u2026 So the idea has to be that there must be a value share, and that is the way to go forward.<\/span><br \/><span style=\"color: blue;\"><br \/><\/span><span style=\"color: blue;\">Innovators out there, the banks themselves, have to come up with services whereby both sides can gain from it. It may just be that for example the bank benefits from having the hard currency coming to the bank account. Fair enough. Then the fintech can make their margin elsewhere. It might be that the fintech and the bank agree to split the fees 50 per cent. There can be many other things, but what they can\u2019t be is just the finTech saying \u201cOh, yeah, I\u2019ll use those bank accounts, but I\u2019m going to take all of the value myself\u201d, and vice versa. You can\u2019t have the bank just saying \u201cI\u2019m not going to work with you,\u201d because we need to work with the fintechs.<\/span><\/p><\/blockquote>\n<p>Basically, he is afraid that banks will lose their ability to make up the rules of the game so that they can profit by cheating the rubes.<\/p>\n<p>I&#8217;m hoping that his concerns prove true.<\/p>\n<p>H\/t <i>Naked Capitalism<\/i>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Could someone explain to me why banks becoming utilities is a bad thing? The head of Ecobank in the UK, Edward George is filled with dread at the prospect. The idea of this happening fills me with hope: \u2026\u2026\u2026Well, one of the big challenges facing banks is that they\u2019re in danger of becoming utilities. The &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[456,417,367,437],"class_list":["post-179585","post","type-post","status-publish","format-standard","hentry","tag-finance","tag-international-commerce","tag-internet","tag-regulation"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/179585"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=179585"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/179585\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=179585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=179585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=179585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}