CathInfo.com

Would you prefer that they managed your account and insured the money in it for "free"?

When a bank lends money out it has credit risk when it borrows your money you don't up to the FDIC limit.

The worst thing about banking is the high barriers to entry and the lack of wider competition.  I am sure that if Google and Facebook were allowed to hold your savings the rates of savings interest would go up and the banking fees be driven down.  It would probably be easier to make payments to people too, although it is a lot easier today than it ever was before.

You can always bank with a credit union.  They are much less usurious but they also have less branches.  You can maintain a $1000 balance in your account and be disciplined about it and always pay your credit card off in full on the due date and you will never pay charges or interest, or at least they will be minimal and justified by the convenience.

If you use banking services prudently and  judiciously your bank are not even making a profit from you.  All the mugs who borrow and pay high fees and late payment and bouncing check fees are subsidizing your financial services.

When you buy items on-line does it not strike you as highly convenient and useful that a third party like Mastercard or Visa or PayPal is prepared to guarantee the payment and the delivery of items?  Without that how could on-line merchants operate?

I buy stuff on line pretty much every day and I remember the old "going to the shops" way and frankly I prefer the new.  If that costs me 1 or 2% in fees I consider that fair for the time and gas it has saved me as well as the lower prices and general convenience of getting what I want when I want it.

Last week for example my 18 month old broke the glass on our coffee maker.  A new one would have cost $35.  Within a few minutes I measured the holder and order a new glass from Amazon of the right size for $12 including the postage.  It arrived two days later.  How would I fix that before the internet or plastic?

The thing is that you get less than 1% on the $1000 when you put it in the bank and most people pay over 10%, more like @ 30% on credit card balances. That is a unfair. That is usurious.