Ben Soppitt

Banks committed the biggest heist of all in convincing us they were free

You can buy an iPhone 11 Pro Max for $41.67/month. Seems pretty good value.

Millions of Americans are paying more than twice that today for their banking — or more than the cost of two iPhone 11 Pro Max’s. Almost all unaware of how much “free banking” really costs.

If a bank suddenly told people it would cost $80/month for a bank account, and the more money you have the more you pay, their customers would immediately leave.

But isn’t banking free?

The top 6 banks in the US made record profits last year. If banking is free, who is paying?

You are!

The combination of cash held in checking accounts paying no interest, unused credit card rewards and poor investment practices is costing the average middle-class family over $80K over the 30 years of their working life. We are paying premium prices for used car value.

Unifimoney has been created to solve this and give back the hidden costs in banking to help people build and protect their wealth. Our members automatically and by default model best practices in personal financial management, effortlessly.

No one likes to be ripped off, we all still carry the natural and instinctive sense of fairness from childhood— having a toy grabbed, being cut off on the road, pushing in line, getting overcharged.

Sometimes these moments become ingrained — an unfair tax gets introduced but gradually people get used to it and it’s taken as part of the natural order of things. How long can you really stay angry, at some point you just need to accept it and get on with life. These things become invisible to us.

“Grant me the serenity to accept the things I cannot change. The courage to change the things I can, and the wisdom to know the difference”

Reinhold Niebuhr

What happens though when something changes from being something you cannot change to something you can? What happens when you suddenly have an alternative?

Such as when an involuntary “tax” becomes voluntary.

That’s why we created unifimoney — to offer the first real alternative to traditional banking services, one that works in the best interests of the consumer to maximize the returns from their own money.

We make your money work for you, not the bank.

We do this by changing the long-established model of banking from being high cost and high margin to low cost and low margin. We still want to make money, but we do it in a way in which we put consumer’s interests first.

Free banking isn’t free — it’s darned expensive!

Curiously, despite being apparently free, The 6 largest banks in the US alone made record profits last year, over $100bn. That’s over $300 for every adult in the US — every single year. Chase and Bank of America are the 6th and 9th most profitable companies in the world!

Banks rely on their profits on consumers thinking it’s good value and there are no alternatives. If banking was a psychological condition it might well be Stockholm Syndrome. Free banking must be one of the most successful marketing initiatives ever, we are all paying whilst believing its free, it’s a “hidden tax”. We often do things that are illogical and against our own best interests, and it can cost us a fortune, this is one of them.

It should not surprise us that banks are so keen to continue this model and to assist in that they invest vast sums to convince consumers it’s all OK — the top 6 banks spent over $10bn in advertising last year alone.

Despite this there is no anger, we just accept it, it’s the way it’s always been and after all, what’s the alternative — right?

Where does all the money come from if banking is free?

For those fortunate to have cash in the bank — a large proportion of this cash is typically held in a checking/current account with the average checking account Paying 0.06%. These same funds are lent by banks to other people at rates up to and above 12% in mortgages and loans. Over $2 trillion is held in checking accounts in the US earning little or no interest for consumers.

 

That $2 trillion can earn banks a potential $400bn+ in revenue every year in loans and mortgages. That’s a lot of executive jets.

For those less well off fees can rack up fast. For many banks, up to 40% of revenue is fee-based. Everyone pays, rich or poor, one way or another, pretty similar to a tax really.

We are utterly reliant on banks as a utility but we have not seen them change as quickly as they could and should have done. Technology has enabled consumers to access money in more ways — phone, app and online.

Technology has also helped banks reap rewards from increased efficiency and speed. But we have not seen the dividends from technology in terms of the increased returns to consumers. The digital dividend has been pocketed by the banks.

So what’s the alternative?

We are — unifimoney

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