Social Banking Revolution?

by Dan Robles on 05/16/2010

m-viaIf necessity is the mother of invention, then the Future of Money and Technology Summit 2010 was Paul Revere.  There were many innovations that seek to change banking as we know it using a new denomination called social currency.  This article (and more to follow) will identify the difference between two business methods – one that squanders social currency, and one that liberates social currency.

m-Via, is a money remittance company focused on allowing consumers to use any mobile phone to make international money transfers. m-Via focuses on the huge flow of remittances from the US to Mexico.  I am personally directly aware of the challenges related to money transfers across international borders specifically Mexico; bank fees, extra ID, teller costs, time, risk, conversion fees, etc.

It is obvious to me that M-Via is looking very closely  at how, why, and when people interact with a the banking system.  The Banks are doing the same thing.  The difference is that Banks seek activity thresholds and then design limits that seem to trigger artificial and exorbitant fees.  Instead, m-Via seeks to reduce the friction in the transaction to meet the lives, schedule, priorities and concerns of the  customer.

m-Via is trading in social currency

Banks are squeezing the least deserving by charging hidden fees for services that cost them nothing.   For example; most people transfer small amounts of money on a steady cash flow schedule.  Most people can’t spend the time to travel to a western Union on one side on each side of the transaction where travel expenses and security issues may be a constraint.  Money is often redistributed among family members once in the target country. This is the reality of people, not an opportunity to set artificial thresholds to drive profit.

Paying money to a bank for the privilege of paying money to the bank…what?

m-Via drives a social currency by reducing risk, increasing yield, and helping people organize in the manner that suits their reality – not that of the banking industry.  Most people who need money, don’t necessarily have the ‘money’ to absorb high transaction costs of time, risk, and inflexibility. Current banking practices extol a high social currency cost that amounts to “negative” interest rate against the consumer – in other words, people need to pay the bank in order to pay the bank to use the bank.

m-Via is already seeing a week over week growth of 15% in participation.  I expect this growth to continue especially as many other technologies arrive to build out the infrastructure of transactions and business methods that are supported by a social currency.


{ 29 comments }

Sabbir May 31, 2012 at 6:56 am

Check out a couple of banks near your home. If there is a cidert union, check with them and see if you qualify for membership.Many places a minor can open an account for $50. It may be higher but most banks will give a youngster a break, knowing they may stay a customer for years. Yes, you will get interest but it may not be a very high rate. Ask the banks about that. You may be able to find some information at their websites but you can also call.

Petr Macek (interneotvý marketing) November 5, 2010 at 5:18 am

Good article, I am just preparing a strategy concept for social media for my banking client and this information I can use.

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textpack May 17, 2010 at 5:12 am

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ingenesist May 16, 2010 at 3:48 pm

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Hot In Business May 16, 2010 at 12:28 pm

Social Banking Revolution? | http://www.relationship-economy.com/?p=10289

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Joe Grasso May 16, 2010 at 5:04 am

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Achievers Network May 16, 2010 at 5:04 am

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smconnection May 16, 2010 at 5:04 am

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prblogs May 16, 2010 at 5:04 am

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The Social CEO May 16, 2010 at 4:31 am

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