Does anyone here have any advice on how to start from scratch and small of creating a Bank ingame?
I know that I am not efamous like Chribba and banks are built on trust, but I really want to earn profits for myself and depositors through Merit!
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Ask the guy at number 6.
There isn’t any way to earn profits for your depositors, only for yourself in the long-con. You can look up the details of Ponzi schemes - the idea is straightforward. There are plenty of dupes in Eve that will go along with it.
Even banks in real life cannot make profits for their depositors - the tiny “interest” rates they pay are inconsequential when you consider inflation and periodic system resets. You could attempt to invest in some sort of Eve “asset” that will rise in value, but even in that case you would need to dump the investment prior to the crash. Most of Eve’s assets decline in value over time.
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Hi Xeux, that is not true. Collateralized Loans on these forums pay interest rates such as 1 or 2 or 3% per month. Also, you can invest the deposit money into things like crashes of Plex or dips of Plex, etc.
Go for it.
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Thank you friend and for the fast replies. I wasn’t shooting down your comments, just wanted to give my answer.
Players can always not repay loans. That’s why people who give loans usually ask for collateral (Items/ships) to cover the loan. Would be hard to make it profitable enough to justify holding people’s money, because not that many players ask for large loans. ISK is plentiful once you settle on something you like doing.
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I personally love the idea of an ingame player run bank. All I can say is its been done on a far larger scale by guys far smarter than me, and all it took was theft by one player to crush the bank.
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As other have outlined, there are a few problems with banks which are very hard to solve due to in game mechanics. I don’t think it is impossible to run a legitimate bank in Eve, just difficult, time consuming, and probably not worth the investment (for anyone involved.) Let’s take a look in a bit more detail.
When we think of banks we typically are talking about two functions: 1) a place to store your money that is safe and accessible, and 2) interest is paid on the balance making it better than money in your mattress. The game itself provides the first function through your wallet.
To return interest to account holders, you either need to be generous, investing it, or scamming them (paying in the short term to steal in the long term.) investing ISK to turn a profit is not hard and can be done in any number of ways. The real factor here is that if you are paying interest, you are reducing your own profits, so whatever you do needs to be either inaccessible to you currently (lacking start up capital) or very profitable, potentially both. For the sake of discussion, let’s assume you have a way to invest the ISK, pay the interest, and still turn a profit for yourself.
The next big issue, as others have stated, is trust. This is much harder in Eve than in real life because we have laws and other means to deal with defaulters, including banks. This doesn’t mean that people will always get their money back from bad investments, but it does typically mean that those accountable get punished. As previously mentioned, collateral is the main way we work around this in Eve. If you default, I keep your stuff and can sell it to recoup my loss.
For a bank to operate this way in game, it would essentially have to stake it’s own collateral against money held, putting a hard cap on how much ISK could be managed. The idea would be you take some valuable items (a handful of officer mods for example), and contract those to a 3rd party who can sell it and pay off account holders if something happens to the bank. In affect, this moves the trust relationship requirement from the account holder to you, trusting that the 3rd party will hold your goods indefinitely while your bank operates.
Account management would have to be handled through something like in game shares, so that the 3rd party would know who got how much of the liquidated collateral. And as share value increased (interest being returned), you would need to add more collateral.
This is hardly a refined model for banking in Eve, but at least touches on some of the things you might consider if you really want to set up a small bank.
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That’s not bad. I like the collateral idea. You’d need a good third party holding service.
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Is 2-3% really worth the hassle?
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Maybe, if it’s hands off. But it won’t be.
Hi I would like to make a deposit in the bank?
This one never gets old.
You have 2 ways to make money at banking in eve, if you aren’t planning on stealing from your customers.
- Invest other people’s money in your money making schemes. (You borrow from them) They need to trust you.
- Invest money in other people’s money making schemes. (They borrow from you) You need to trust them.
There is zero demand for a depository bank. No one can steal your isk from your wallet, no one needs a bank to be an intermediary in financial transactions.
It’s all about lending and borrowing.
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Did I miss the train on this investment opportunity?
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Banks in Eve, never heard of it.
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