Fastforward 60 years: it seems to me as though it has gotten to the point that operating without a bank account is neigh-on impossible, especially for businesses. Which has - predictably - led to one rate increase after another, especially with interest rates near zero banks need other sources of income or they won't be able to make their 'quarterly earnings targets', which are apparently somehow set in stone and shall be satisfied come what may.
So, I'm wondering: is it still possible as a private individual to operate without a bank account? What about doing so as a business?
Is anybody here doing this?
(Here in the US we have numerous kinds of organization that look like a bank superficially but have different regulatory regimes: a credit union does what a bank does but is a consumer cooperative. I'd also say that many local and regional banks have a much better customer service attitude than megabanks. I own stock in a local bank that is great for the community and beats Goldman Sachs on the performance of the stock... I can't see why anybody has an account at Bank of America.)
People who grow cannabis also are unbanked.
First off - how would you get paid? AFAIK, employers are not obliged to pay you in cash. So you get a paycheck - how do you cash it? You go to a bank, post office, or stores that will let you cash out the check. But that's against a fee, and to be honest, it's 20 years ago since I last cashed a check - so I wouldn't know how much those fees are today.
You now have cash in hand, and you need to pay your bills - so you walk down to the nearest bank, or similar business that offers the service. Again, you'll probably have to pay a free for each processing.
But let us for a moment assume that you live out in nowhere, with no such services available? That's my case right now. The nearest bank is a 7 hour drive from where I live! All the commercial banks near me have closed down, due to everything being done online these days.
So, yes, it should be possible - but it sounds like a hassle. And there are predatory industries that solely exist to prey on the unbanked people of society.
And in the long run, it'll probably just be an uphill battle. Governments all over the world are moving away from physical cas.
For most people for whom banks tend to make sense, it seems like an avoidable source of friction at best and a poor dying-upon-hill in general considering credit cards are issued by banks so online is out.
I mean once you’re six sigmas bought in to the system by running a legitimate business, it’s not a very high moral high ground assuming it is moral high ground at all.
-You can cash your paycheck at a check cashing place for a fee. Or at some stores but they expect you to buy stuff there.
-No checks, buy a money order. For a fee...
-No credit card, buy one that takes a % fee
-You'll need to keep your cash in a safe place. There is no such place. Some one will find it and likely take it.
-No bank, no credit
-No credit no reasonable loans. You might get one but it will be at a high percentage, in the 100%+.
-No credit, no mortgage, no property
-No long term savings , no retirement savings
It turns out that a cash only based life style is inconvenient and expensive.
I think the inability to save makes it hard to plan for the future. In a way it makes it hard to escape it so the longer you are in it the harder it is to escape it.
I've wondered if being unbanked shortens your life. Especially if you need to constantly protect your money from thieves and the dangers that come from that .
You won't get paid in cash. You won't pay your rent in cash. You will need it to register a business, get social assistance, pay for your health insurance and a lot more.
You are legally entitled to a free bank account, but it's still difficult to open one while you wait for your residence permit and address registration (both of which can require a bank account).
This is a major problem for Ukrainian refugees at the moment. The government wants a bank account to pay social benefits, but banks won't let them open one with the papers they have.
I have a whole section of my website dedicated to that cluster of issues and it's very popular.
As a business I would imagine fees would be pretty irrelevant, if the business was profitable.
Being actually unbanked sounds pretty awful. Even if it did have a fee I would still rather pay it that deal with cash, since fees are usually around $5, which is 20 minutes at $15 an hour, and the total inconvenience would probably feel like more than 1 minute a day.
It looks like some people manage. I would assume that most people in Western countries who do not hold a bank account have access to one by proxy (like a married couple where the account is in the name of one of the two, etc.).
As a business, unless you’re a small brick and mortar shop, I don’t see how you could get any customers without accepting anything else than cash/cheque payments (and I don’t know how easy it is in France to cash in cheques without a bank account). Paying ISP and mobile phone bills in cash is likely a misery, but other than that (and a lot of queuing in various places every month), it should be doable.
The postal banking here in France is good and cheap enough that it wouldn’t make economical sense to not use it.
One of them got one of those 'bluebird' cards.. like a prepaid debit card from American Express.. free to add money via direct deposit I think.. can add cash as walmarts cheap, dollar generals a little more, walgreens a bit higher.. can get free at many ATMs a small fee at others..
From what I understand the bluebird now has two versions(?) and one is more like an online bank system..
They must of put a hurt on greenDot cards as I've seen some of those advertised that they no longer charge $10 a month to have them - but I think there are some that do.
Living without a credit card is getting interesting.. Enterprise is no longer renting cars to me here in this mid size city without a CC (although they said I can bring a copy of a mortgage deed and utility bill and insurance paperwork from same addy to bypass) - some hotels are not letting you checkin without credit cards these days - meh.
Meals are usually prepaid by the concierge or local hotel staff, they also handle all of our household staff.
Not really. You could, but it would take a lot of effort.
Many places don't accept cash, like paying the power bill (could get cashiers checks). Unless you have full cash for a house, you need an account for the pedigree of your mortgage down payment. Some jobs only do direct deposit. Without any credit vehicles (cards, loans, etc, which are technically accounts), it can be hard to even get a place to rent if they do credit checks.
For example, it is really hard to pay rent without a bank account in average circumstances, but if you have a roommate that will take your cash and has an account, that makes things easier.
I’d suggest trying it out. The answer has more to do with the requirements of your lifestyle than some arbitrary concept of “possible operation.”
Do you consider unbanked homeless people as “operating” people? If not, what do you call them?
National commercial banks do like to find fees for everything, but most/many credit unions have 'no fee' accounts, and so do a lot of banks. Sometimes no fee means a lot of hoop jumping, but often not.
Business banking is different; a lot of credit unions don't touch business banking, and there's a lot more services businesses might need so more nickel and diming to take place.
But bank accounts make many things much, much more convenient.
If you don't setup direct deposit before your first paycheck, instead of mailing you the paycheck you get a debit card. You can then withdraw the full balance out of it every two weeks without any fees.
This doesn't help with all of your banking problems, but it's a good start.
Can it be done? yes to some degree but you will need to sacrifice a lot and not only convenience
I would of joined one and gotten a few others to at least try it out - but that just seems shady (hard to cancel / no chargeback for shady actions) - what kind of business relationships are they trying to take the power over in.
Alternatively, they could have had serious financial problems in the past and thus are blocked from opening a checking account. Either way, it's a very bad idea to get involved with them.
At a high level, while banks theoretically primarily provided the 'don't get mugged' service in the past, presently they also importantly provide de-facto services like: taxation and AML choke point for government, identity verification and re-authentication services, lost funds debugging, due legal process for dead and mentally unwell people, bridge to third party settlement networks, evidence-of-funds, evidence-of-income, capital provisioning and macro-economic policy implementation partner with respect to state-usury and inflation, etc.
Even if you don't require the "don't get mugged" service (eg. your superyacht is packed with bullion and you travel with a private army), you may find it hard to deal with others (eg. how do you pre-pay for mooring locations, new army recruits, satellite telecomms services or carry permits before you moor the yacht at your tax haven/island of choice?). Using a more down to earth example, you'll find it hard to purchase tickets to travel, food to eat, or restore access to funds if you forget your crypto password, have a stroke, become bedridden, lose your stuff in a fire or get mugged. Similarly, getting a loan or immigrating will become impossible (no proof of income/funds). Excusing the tongue in cheek examples, removing banks thus causes social fabric issues, despite the fact that everyone hates them.
IMHO it's becoming globally more viable due to new technology (mobile money, statecoins, etc.) but replacing the bank with the third party crypto-exchange (crypto-liberatarian dream at the facade, heavily yoked to techno-capitalism and existing state bank control mechanisms behind the scenes) or directly to the state (digital yuan/statecoins) is just shifting rather than solving the problem.
As it seems you are wondering about interest rates, that's less about banks (FWIW I used to share a house with someone on the interest rate committee for the Bank of England) as they basically echo the government numbers (and then add some). Interest rates at the national level are more about macro-economic policy which is political, and a case may be made that they are a requirement from governments in turn for participation global capitalism and real world supply chains for societies that rely on global resource extraction. Put simply: if you want a functional post-industrial society currently the only way to achieve that is through global trade, and if you're going to join that bandwagon you have to deal with inflation as a matter of course. Of all the available political macro-economic levers, central bank interest rates are among the least disruptive and most timely we've come up with. After all, if you don't like it, change currencies.
In short: if you're mostly worried about bank fees, change banks. If you're mostly worried about interest rates, change currencies or get out of fiat currencies entirely and in to a broader portfolio, eg. real estate, stock, commodities. If you want to reorganize society to libertarian ideals and plant a vegetable garden, better get ready to give up all your technology and prepare for political and economic irrelevance... and you might still get mugged for vegetables.
Can one live in society without a bank account?
Sure prepaid cards that can be loaded up with $ to pay for the usual things like cellphone bill.
Cash is king. Crypto will probably be something that comes along soon.
All these things basically let you get around a bank account and equivalently let you move your butt to somewhere you will be accepted.
>Is anybody here doing this?
While Canadian politicians did recently seize bank accounts subverting the judicial system and violating the human right against search/seizure...
I still have my bank account. I encourage the government to come take my debt. Not much else going on there lol.