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Do you really believe the correct solution for these problems is to essentially make every financial startup a DBA of HUGE_BANK_X? That's one of the main reasons we don't see any innovation in the banking space where things are desperately underdeveloped. A benevolent banking startup could do a lot of things to really help consumers, and they could do them EASILY with what we have in place now. They could implement reasonable and sustainable fee structures and they could set account transactions up such that fees are avoided instead of maximized. Big banking wants to keep things right where they are, of course; if they could possibly get a fee out of you based on your account's activity, they are going to do everything possible to make sure that things execute in such a way that that activity occurs: arbitrary holds and delays on checks, manipulation of transaction post orders, intentionally confusing account summaries ("account balance" and "available balance", and sometimes worse), nickel-and-dimed on fees for normal usage ("0.50 analysis fee", "5.00 new card fee", "5.00 maintenance fee", and soon, "5.00 debit card fee"), and many, many other things all collude to create a horrible experience for the end user. "Front banks" like WePay, Braintree, or others, can't really do much about these processes and have to forward the BS received from the big banks on to their customers. You can create a pretty frontend, like BankSimple, but the reality is that you can't really make much of a change when you're subject to all of the same problems that your end users are already struggling to deal with every day. |
AFAIK Bancorp is not particularly huge by contemporary standards. But I see only three alternatives to being an agent of a bank:
1. Be a money transferor
2. Be a bank yourself
3. Get the law changed
None of these is very easy to do. Being an agent of a bank could be the path of least resistance.