
How We Measure - Flenser
https://www.simple.com/blog/how-we-measure/
======
caidan
I like Simple and I wish them success. I don't like them because of their
fantastic app and website, or excellent human customer service, but because
after many years of abuse at the hands of Bank of America I wanted a bank that
does not aggressively pursue Non Interest Income (ie fees, usually overdraft)
as a major source of revenue.

Simple states very clearly on their faq[0] page that they make money off of
interest and interchange fees, not punitive and arguably immoral fees like
those imposed by the large mainstreet banks. Head over to this reddit
thread[1] from this morning that discusses what it's like to work for these
banks: "[the customer who was mistakenly charged the fee] struggles from week
to week with finances, and needs every dollar more than the rich customers who
treat us like shit yet the managers kiss their asses. It wasn't the customers
fault at all yet they have to suffer".

All of the large banks are ruthless predators on the weakest of our societies,
gouging their customers with an ever evolving scheme of fees and debt
incentives to ensnare, entrap and exsanguinate those who can least afford it.

They are involved in price fixing scandals of the highest order, are beyond
the reach of the law no matter the transgression, and seem to hold the sum
total of our shared societies in contempt. Apparently there is very little
that can be done at this point, the horse as long since bolted, but at the
bare minimum I'll be god damned if I give them a dime I don't have to. Simple
enables me to bank as usual without continuing to participate in that abusive
relationship, and for that, I like them.

[0] [https://www.simple.com/faq/](https://www.simple.com/faq/) [1]
[http://www.reddit.com/r/AskReddit/comments/26qpcq/redditors_...](http://www.reddit.com/r/AskReddit/comments/26qpcq/redditors_who_work_for_a_company_everybody_hates/)

------
rb2k_
Maybe slightly off topic to the post, semi related to their idea of an
"active" customer:

I really like the way simple presents themselves. I don't think I'll join them
any time soon though.

The incentive to use a 3rd party credit card is way too strong. I get things
like cash back (depending on the card, up to 6% for e.g. groceries, 3% on gas,
...) and it helps building my credit score which the debit transactions on
simple won't help with at all.

I do like Fee-Free ATMs, but on both of my current checking accounts (e.g.
Charles Schwab) I don't have to try to find a special one that, judging from
the map, usually means a 10 minute walk. I can just go to any ATM since there
are quite a few banks that will reimburse costs for ANY of them.

Photo Check Deposit is pretty standard these days as well, both my local bank
as well as Charles Schwab had apps that allow me to do that.

Most of the integration that simple provides (the "budgeting" part) , I
probably also get with Mint. Only that Mint actually takes ALL of my accounts
(Brokerage, Credit cards, ...) into account.

Besides that, the last time I checked they only accepted “Type 1 Social
Security Numbers”. Sadly, as a resident alien, I only have a type 2 number
(“for work”). This seemed a bit strange since pretty much every other
financial institution didn't care about the specific type of SSN so far. I
didn't even know there were different ones. They mention on twitter that
they've "processed a few exceptions", it would probably still be very
inconvenient.

~~~
ganeumann
You understand that the "rewards" you get when you use a credit card are
somehow paid for by you yourself, in spades? Visa posted a profit of $1.6
BILLION for the first QUARTER of this year. That's your reward, right there,
watching them make their oligopoly profits off of you.

I meet founders quite often who think they can get their customers to use
their product because it is a _better deal for the customer_. Unfortunately,
many of these ideas are not viable because of the way many people focus on
short-term gains rather than all-in, lifetime cost. It's too bad that many
(most?) people would rather have some immediate gratification from a company
that intends to screw them at the first opportunity than a long-term better
proposition from a company that is trying to help them.

A great example with Simple is when people say they're sticking with their
higher-interest account at a traditional bank. While finding the highest
interest rate may appeal to their competitive instinct, the extra 0.5% or so
on an average balance of even a couple thousand dollars does not even begin to
make up for the surprise fees the bank charges when that person makes a
mistake. The usual rebuttal is "Well, I don't make mistakes." The revenue
split between fees and net interest margins at the retail banks shows that
this is just not true, on average. The argument, then, must be that YOU don't
make mistakes because you're better than everyone else. That's just an
unattractive attitude.

Someone should build some wearable tech that whenever you make an irrational
decision, it beeps angrily at you.

</rant>

~~~
opendais
You are so very, very wrong. They make money off of interchange fees and
carried balances.

These "rewards" are rewards for the consumer if you: 1) Never carry a balance
2) Pay the same price as cash and the merchant eats the fees [as most
merchants do!]

Its perfectly rational if you make fewer mistakes on average. So far, in the
10 years of using credit cards, I've recovered about 2% of every dollar I've
ever spent and never carried a balance. This amounts to half a paycheck.

Its perfectly rational to assume that my rate of 'error' will remain roughly
the same as it has been historically and that I want to continue to use credit
cards and force merchants to effectively give me a larger discount that they
would otherwise.

~~~
jawns
You say that the merchant "eats the fees," but what actually happens is that
they price their goods higher to compensate for the fees.

What's worse, because the vast majority of merchants charge you the same price
whether you're paying cash or credit, people who pay cash are, in effect,
charged these hidden fees as well.

If people stopped using rewards cards, and the merchants didn't have to deal
with the associated fees, the cost of the merchandise would arguably drop by
the same percentage as what you're getting back in rewards.

~~~
tesseract
> What's worse, because the vast majority of merchants charge you the same
> price whether you're paying cash or credit, people who pay cash are, in
> effect, charged these hidden fees as well.

Their merchant account agreements actually require cash/card prices to be the
same. (Credit card purchase minimums are generally not allowed either - of
course that doesn't stop many merchants from trying.)

~~~
rodrodrod
I think what jawns is getting at is precisely because you can't price-
discriminate on the payment method, you might as well increase prices for
everything in order to cover transaction fees (operating under the assumption
that most customers will pay with credit card), which effectively means that
cash-paying customers get stuck with those fees.

~~~
opendais
That is incorrect as of 2010 and was incorrect for several states before 2010.
:/

------
bicknergseng
From the Quartz article linked:

"If it was after technology alone, BBVA could have built a platform in a few
months for half a million dollars, [banking consultant Serge Milman] says."

I know this was probably hyperbole of the cuff, but it seems rather unlikely
that any bank, institutions that are non-tech focused, could develop the same
tech as a tech startup like Simple or Mint in a few months for a half million
bucks. Pretty classic "ignorant of the true cost and complexity of software"
attitude.

------
ericcholis
Slightly off-topic, but can any current Simple customers comment on their
experience with the service? Their marketing is makes the service very
appealing, I'd like some real world experiences though.

~~~
mrcwinn
Simple customer here.

I've been very satisfied with their customer service. I've been very satisfied
with the fact that there haven't, to date, been "surprise fees." I've never
been charged any kind of fee for using the service. I like their goals system,
too. Tiny bits of money leave your main account (it's still usable though, in
case you spend more than is in your perceived "balance"). You end up saving
money without noticing it, which is nice.

Other little moments where you interact with the bank are better: getting a
replacement card, for example, is very easy and fast.

Downsides: \- The money you save isn't earning any real interest, though
that's nothing different from a typical savings account.

\- It's impossible to get cash into your account. I generally don't use cash
very often, so this isn't a huge problem - but every so often, it's been
incredibly annoying. Forget about ATMs, too. I can't use my Simple card at an
ATM without paying a big fee. There are some fee-free Simple ATMs through a
partner, but I've never found a convenient one.

\- If you have an especially large check to deposit, good luck! The mobile
scan limit of, say, $3,000 is not unique to Simple - but what is unique is
that you have no branch to walk into.

That being said, I've had such horrible experiences with BofA, I'm happy to
not have a branch.

Is my mind blown by Simple? Not really. It's fine. I like it. On the other
hand, I can't say I've ever been a fuming, angry customer in front of Simple -
and I can't say the same for most of my other banking experiences.

One alternative to consider: I've heard Capital One 360 is nice and
comparable.

~~~
ssharp
I signed up for a Simple account when my turn on their wait list came up, but
I quickly realized that there were too many limitations for me. The app and
interfaces are nice, but some of the things you mentioned were ultimately
deal-breakers. I have to deal with checks over 3k more than once a year and
also have the occasional cash transaction of over $2,000. And that goes both
ways, where I need to withdraw over $1,000 cash on occasion.

At the time, they also didn't allow for joint accounts. I don't know if that
has changed yet.

I ultimately switched over to PNC because they have good branch and ATM
coverage in my area and although their mobile app and web interface cannot
touch Simple, they were substantially better than my previous bank's
offerings.

Someone told me that Charles Schwab checking accounts, although also virtual,
reimburse all ATM fees. According to this person, that includes ridiculous
fees like $20 at "gentleman's clubs".

~~~
ensignavenger
If you need to withdraw more cash from Simple than the ATM limit, you can do
so at just about any bank counter as a over the counter cash advance, there
are generally no fees charged for this service. Checks over the deposit limit
are a bit more of a challenge- unfortunately, I haven't had that problem :) I
think you can mail them to Simple, but that is a few days delay.

