Cruiser's Credit Union?

[robn]

Who among us cruisers has not had problems with banking? I would like to propose that the cruising community create a banking cooperative that is more friendly to currency exchange, temporary addresses, and selling boats internationally among other services. I am far too ignorant on banking issues (to the point of battling phobia) to be the one to take on such a project but I would sure love to see others do so. I'd help if someone could tell me how.

First question would be what countries' laws to charter under.
Any one have any ideas, input, suggestions?

[rebel heart]

I think one of the challenges would be making revenue. You (the bank) has to pay transaction fees and talented people, even working part time, are still going to expect some type of salary for their work.

Most banks make money on loans of various types, and their losses combined with interest pay outs are less than loan revenues which in turn equals profits.

I'd love to be involved in something like that, I've worked in finance and insurance for almost ten years at this point. But the volume of work (including regulatory) is significant.

The failure rate for US banks is quite low: it's a good business to be in. But it's a business and you need to make revenue, if if you're a non profit.

[Hudson Force]

Although our liveaboard cruising has been restricted to just half a dozen countries, we have traveled extensively and found that the complications of currency exchange and banking have been made much more simple over the last couple of decades. We keep an account, a pair of credit cards and a pair of debit cards at a local credit union. With our concern to advise our cardholder services with the timing and location of our travel we can conduct all our activities with our local institution world wide. Cell phones and ATM's have made everyplace "local". Internet security while banking online and keeping a view of your account activity is important, but the ease of international travel is far advanced over the days of traveler's checks and moving money by "wire". My experience does not include any events related to buying and selling vessels internationally, but I can't help thinking that it's easier than it would have been before today's communication advancements.

[David_Old_Jersey]

Originally Posted by robn

Who among us cruisers has not had problems with banking? I would like to propose that the cruising community create a banking cooperative that is more friendly to currency exchange, temporary addresses, and selling boats internationally among other services. I am far too ignorant on banking issues (to the point of battling phobia) to be the one to take on such a project but I would sure love to see others do so. I'd help if someone could tell me how.

First question would be what countries' laws to charter under.
Any one have any ideas, input, suggestions?

I think a non-starter as market way too small. and unprofitable.

But in 2013 plenty of choices available for folks - just have to educate self and decide what works for "you".

For a Temporary or Accommodation (aka pretend) address the USA is about as lax as it gets (in the Western world), for the rest the answer is likely not to confuse the bank with too many details........exceptions are available to the standard T&C's of a bank on Addresses, but the bank plebs that most of us deal with won't have that discretion - to get further up the chain you usually need more money to be worth bothering to deviate from "standard".....Any new bank would have the same legal requirements.

[hellosailor]

"create a banking cooperative"
Well, here in the US, I've never heard of such a thing. If you mean charter a bank, that's a business not a co-operative. If you mean a credit union, that's still not a co-operative, you can't require the members to work and own, can you?

There are a number of institutions that target travelers, among them American Express. But they all charge fees for their services. Odds are that if you explore the costs of chartering and operating whatever kind of "bank" you're thinking of, that it will be much cheaper to simply pay the fees at existing institutions.

[robn]

International Banking has definitely become far far better than it was when I first cruised in the early '70s and dealt with bank drafts. But recently I have seen many new money handling products available like on-line banks and PayPal. I do not know the terminology well, but I think what I'm wishing for is a credit union complete with paid professional staff that caters to travelers. And I think the market is plenty big enough - I checked a couple of credit unions at random that had 1300 members and 2100 members. That's peanuts compared to the number of travelers out there even if most don't want to join.

Recently my bank blocked my card "for use abroad" even though I have never used it anywhere else but here. I could go on. But we are square pegs in round holes and I refuse to believe that square holes are not possible.

[ohdrinkboy]

In the US the regulations are unbelievable.....all for the protection of the consumer of course

[Hudson Force]

Originally Posted by robn

.......................... Recently my bank blocked my card "for use abroad" even though I have never used it anywhere else but here. I could go on. But we are square pegs in round holes and I refuse to believe that square holes are not possible.

This is certainly the best practice! I like my card blocked for use in all the places where I am not present! I keep in communication with my credit union so that my card authorization matches my travel. If you're not gaining this service, maybe you should shop around. Square pegs are customers in demand and you can abandon the round holes for the square holes that want your business.

[Teknav]

Discover Card is ALSO the former Diners Club. It will block your transactions if you are out of your mailing ZIP code; exaggerating a bit, here. However, if you let them know in advance that you will be traveling to "Istanbul/Zanzibar" you'll not have any issues once there. Their exchange fees are similar to AMEX and are somewhat reasonable; you can contest international charges and fees.

Did you know that Diners Club was the first charge card ever, to start this business?; it caught on like wild fire.

Mauritz

[robn]

Okay, looks like folks are happy with the status quo and don't find the idea of a cruisers credit union to be of interest. Nothing ventured, nothing gained. As I said, things have been improving anyway - at least in some respects. Just thought maybe the timing was right, but I guess not. Happy banking. Robn

[hellosailor]

"Okay, looks like folks are happy with the status quo and don't find the idea of a cruisers credit union to be of interest."

Spoken like a true troll.

All that it "looks like" is that you have no idea how much work, time, and money it would take to set up your mythical co-operative, and the folks who do, don't feel like spending that.

Happiness has got nothing to do with it.

Do some homework, learn the magnitude of the task, run the numbers for ROI, and then try pitching happiness to folks.

[denverd0n]

Hellosailor might have put it a little harshly, but I have to basically agree with him. You readily admit that you don't know anything about banking, but seem to be absolutely certain that running a banking cooperative would be a simple thing. As if the only reason it doesn't already exist is because people are all too fat, dumb, and happy with the current options.

If it was as simple as you want it to be, someone would already be doing it. The reason that no one is, is because it is not anywhere NEAR that simple.

(And this is coming from someone who has spent about 15 years of his career working in the financial industry.)

[Hudson Force]

[QUOTE=robn;1302097]Who among us cruisers has not had problems with banking? ........................... [QUOTE]

Most of Us? For sure, me.

[Teknav]

Call me a very very old fashioned guy. When I travel, I still carry with me a few thousands of dollars in AMEX traveler's checks. They are obtained commission free from either AAA branches or some banks. Upon arriving, I have yet to see a bank refusing them when cashing a few; usually no commission. All major hotels, will gladly cash your traveler's checks for up to $200 USD per day; slightly better rate than converting US currency. With over 40 countries visited so far, I'm not about to change what works for myself!

Mauritz
Different strokes...

[zboss]

Originally Posted by rebel heart

I think one of the challenges would be making revenue. You (the bank) has to pay transaction fees and talented people, even working part time, are still going to expect some type of salary for their work.

I think a cruisers credit union is brilliant. It could be run by BoatUS ro whoever.

While you are correct about salaries, you can run a major on-line 3.0 bank with fewer than a dozen or so resources. For loans and such we could integrate into other 3.0 businesses such as "The Lending Club". My experience comes from consulting to every major bank and financial institution in the US and many in Europe and Latin America where there is cross-over business.

Although my experience is limited as an enterprise architect of IT systems for futures clearing houses and online versions of existing banks, the cost of running a bank these days isn't much more than running a small/medium-small online business.

The most expensive part of running large FINRA regulated businesses isn't the resources but the compliance issues. We accommodate this by building in compliance capabilities into the new systems architectures, so at any time the SEC/FINRA/DEA/FBI can come and audit the system (monthly and on-going in some of my larger clients situations) with very little effort.

Its getting super cheap to run a bank.