T-Mobile Jumping Into the Check-Cashing Industry 211
An anonymous reader writes "T-Mobile has made headlines recently for trying to change the cellphone industry's reliance on contracts that lock customers into a particular carrier. Perhaps surprisingly, they've been fairly successful. Now, they're jumping into another industry plagued by high, customer-unfriendly fees: check cashing. 'Specifically, T-Mobile is hoping to offer an alternative for the 70 million or so U.S. adults that either have no bank account or have some bank services but still rely somewhat on check-cashing or payday-loan services.' How will they do it? 'Through the combination of a smartphone and a prepaid Visa debit card, T-Mobile (and its banking partner, Bancor) aims to offer many of the services typically offered through a bank, including check cashing, direct deposit and bill pay. The service, dubbed Mobile Money, allows customers to purchase and reload the card at more than 3,000 T-Mobile stores and, eventually, at Safeway and other retail stores. They can use the card anywhere Visa is accepted, and can also withdraw money, without a fee, at 42,000 ATMs across the country. Mobile Money customers can enroll in direct deposit for payroll, and personal checks and other types of checks can also be deposited by taking a picture of the check using the smartphone's camera.'"
Why do these exist (Score:2, Interesting)
In the US, most banks have free checking accounts. Why don't these people just use a bank?
No surprise, again (Score:5, Interesting)
The European banking system (T-Mobile originates in Germany) is highly competitive. Checks basically don't exist anymore. You can still use them, but nobody wants to, because the alternatives are much more comfortable and reliable. I can only imagine that the people at T-Mobile are constantly thinking "WTF? Does nobody realize how unnecessarily complicated and expensive banking is in this country? Why isn't anybody doing something about it? Maybe we should do something about it."
Checks in the mail. Seriously, folks?
Re:Why do these exist (Score:5, Interesting)
There are a huge humber of people in the US who are simply unable to get a bank account. As far as the banking system is concerned, they do not exist. Ever see the movie, Elysium? It's like that.
It is tough to see when one is a privileged rich kid. I only learned about it when I picked up an interest in bitcoin and heard someone speak about what it meant for the poor to be able to hold wealth without a bank account and without having to carry cash.
Are checks still a thing in the USA? (Score:0, Interesting)
In the UK I've not written or received one for about 2 years now and I expect I'm typical.
Re:Why do these exist (Score:3, Interesting)
Check cashing is there for undocumented people (who can't provide the basic information to get an account, but are occasionally paid by check). I actually used to work for a bank (one of the larger US ones) that owned a Check Cashing business and they used to send someone out to the day laborer sites on paydays to facilitate the process.
It's about as predatory of a practice as you can get and even the company that owned these check cashing locations knew that it was scuzzy. I remember getting a vibe when working with the head of the check cashing organization that he'd been breaking legs in a former profession.
Maybe T-Mobile can do this right, but it's an industry built on taking advantage of the fact that someone can't use a free service. I don't see how it could be possible to do it right.
Re:Why do these exist (Score:1, Interesting)
Guess what? Those are pretty much impossible to get, due to Dodd-Frank. Dodd-Frank commits age discrimination, by prohibiting legal adults from obtaining credit cards unless they meet income requirements that are impossible to obtain for most young people, especially students.
Now you know who to thank when our society is a race of paupers: a guy who got a sweetheart deal on a loan from Countrywide in exchange for ignoring their fraudulent bookkeeping, and a guy who claimed the Republicans were responsible for the housing bubble bursting while he was the one opposing Fannie/Freddie reforms in the mid 2000s.