[ACow_Adonis]

I'm having a hard time wrapping my head around someone someone in business not understanding charging fees.

You charge fees to get money.

Banks are there to make profits.

You say that banks don't make much money off of it, but maybe your idea of "much money" and mine are different.

In my country, it is reported that bank fees make up approximately 5% of bank revenue, and I'm reasonably sure we have less fees than others. I don't know what business or country you're in, but there's a pretty good guess your country takes in more money in fees, and earning a marginal 5% on anything is not chump change.

May I humbly suggest that your premise is wrong. They ARE significant sources of revenue and profit and banks charge them because they are in the business of generating profits.

[fuzzfactor]

>Why are banks charging so many fees for accounts and cards?

The answer's exactly the same as from the famous bank robber who eventually confessed as to his motivation for living the high life on ill-gotten gains using the same institutions:

"Because that's where the money is."

[BenjiWiebe]

Well, somehow not every bank/credit card needs to charge fees to make money.

I have two bank accounts and 5 credit cards - no fees. And I'm not a rich SV programmer either. If I was, I'd probably get one of those fancy cards that does have fees.

[ACow_Adonis]

Yes, this is product differentiation, features, demand elasticity, network/ecosystem lock-in, loyalty tax etc.

Just as software and internet also has a mixture of free to use, once off, subscription, usage metering and fixed cost revenue, so too does banking and credit services vary their fee revenue structure and sources for its various financial services and products.

It's very hard to make universal statements to how these are structured, but about the only thing I think I can say is that if you aren't paying fees, the commercial entity must be aiming to make revenue off of you being a customer in some way. Some savvy customers can get services with a net positive value for free, but the business at large scale is going to try to extract what value it can.

It's hard to give a universal statement on price structuring, but generally fees can help squeeze revenue out of sticky customers, customers who need your services, customers who do not provide enough net capital or volume-based revenue to cover your costs.

You can also use fees to explicitly target or select for particular users. For instance, in some money and credit markets or markets which offer various costly rewards you can sometimes split your customer base into good revenue sources and costly freeloaders. A fee structure can even help signal or self-select these costly customers out of a product or identify them for your other product lines.

[BenjiWiebe]

> if you aren't paying fees, the commercial entity must be aiming to make revenue off of you being a customer in some way.

Yes, credit cards make money from merchant fees and banks make money from lending your money out.