The next is an excerpt from right now’s World Publication.
It’s no secret that many conventional banks have relied on bank card late charges to bolster their backside strains. It’s straightforward money for them, but it surely’s an intensely punitive apply that may stress customers with crippling compounding debt.
After the CFPB proposed slashing bank card late charges to simply $8 a month in February, the response has been swift and predictable — banks raged.
It’s time for them to tear off the late-fee Band-Assist and discover new revenue streams. This may be a possibility to regulate enterprise fashions and decide the right way to drive worth past late charges. These banks that determine it out will probably be lightyears forward.
A easy shift to subscriptions would change the income and be rather more palatable for customers in the event that they knew late charges had been dusted in alternate for a modest month-to-month price.
Banks additionally need to know there are various in Congress coming after these charges.
Fintechs have constructed their companies on a no-fee subscription mannequin for years, and if banks get it discovered, it will be fascinating to see the way it impacts competitiveness within the {industry}.
From Fintech Nexus
 USA Will fintech take over regional banking? By Isabelle Castro Margaroli Regional banks have taken a beating – fintechs’ customer-centric flexibility might present a solution to their flawed system. |
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