The ABCs of Big Bank Logic Are … Anything But Competition
- Once again, big banks have shown they will go to any length to avoid competition.
- It’s not enough that they want to keep cartel-style price-fixing on credit card swipe fees without any competition.
- Now they want to prohibit consumers from getting any kind of rewards or interest from alternatives like stablecoins — just to avoid competition. (You can read it here.)
- Why wouldn’t banks want consumers to get rewards or interest on stablecoins when:
- Banks give rewards on credit cards.
- Banks give rewards on debit cards.
- Banks pay interest on deposits.
- Bankers don’t even hide the reason. They call it “deposit flight.”
- What is “deposit flight”?
- Um, that means people might want to buy some stablecoins rather than putting that money in the bank.
- And banks just can’t stand for that. They want to be the only option.
- Otherwise, banks might have to pay more than 0.4% interest on savings.
- You don’t like 0.4%?
- “On the other hand, there are savings accounts, particularly those at large national banks, that earn only 0.01%.” ☹
- The banks want you to take that (and thank them for it).
- The picture should be clear by now:
- If banks had their way, there would never be any innovation in financial services.
- Consumers would have the bare minimum of choices or benefits (like 0.4% — or 0.01% — interest)
- And … banks would never have any competition.
COMPETITION IS BETTER FOR EVERYONE
IT'S TIME TO PASS THE CREDIT CARD COMPETITION ACT