A bank?

[Xordan]

Well they're not making any money until people pay back what they loaned and start paying the interest. In the case of mortgages... banks have to wait decades. Not a good source of income (where the money isn't going right back out again in the form of loans), especially when they're loaning that money back out again to other people. It pays off in the long term definitely, and probably is the majority of the turnover, but provides hardly any profit in the short term. The profit comes when the person taking out the loan dies (hence the word mortgage). Using the billions they already have to make money from capital and any other ventures will surely make a lot more than any other method in a given time. Credit is just a long term slow flow of (risk free for the bank usually) guaranteed income.

[Gondric]

OR


We could just wait the what i hope is short time until it gets implemented.

* Gondric looks to DEVS. "SHORT TIME PLZ PLZ PLZ"

[Phinehas]

* Phinehas looks at Gondric for a long time...

You're new here, aren't you?

[Idoru]

where were you considering getting you start up capital, you would either require alot of money yourself or you woul/d need players to save with you, to promote savers you need to give them a good rturn on their investment, good enough that they want to save but not so good that you cant pay them. To make it work you really need to have at least one third more in savings than you have loaned out, that is to cover any withdrawals from their savings players wish to make.

Phinehas is right that members of honourable guilds are the least like to require loans

[zanzibar]

Phinehas is right that members of honourable guilds are the least like to require loans

I don't think this is true.  The Vespers of Laanx for instance is one of the most honourable good-alligned guilds in the game, and they're in constant need of money.  Not loans though, so I guess that argument falls apart.

[Narure]

well it would make sense to use the money people give to you to save and put that to buying gold off the miners and selling it to an NPC for a profit. If you are the shrewd enough business man you could make alot of money.

[Donari Tyndale]

Naturally, the bank will give interest to people saving their money on their accounts. I have also thought about deposit boxes, where people could store their items for a small fee, or maybe free [No more using the shelves in the library ]. Furthermore, transactions could be made through the bank, it is loads easier than meeting all the time. Pets carrying messages can give the transaction orders to the bank [/tell], that is easier than meeting to trade. Starting money is no problem, I have loads of it. The only thing I am currently thinking about is how to reduce the risk of someone not paying a credit back and the interest rates. How does 4% interest per day on loans sound? That is about digging once per day per 100k [A RL day]. And about 1% interest per day on money stored at the bank at the beginning, if all works out more.

[bilbous]

It sounds like usury especially if it is compounded interest.

[Kaerli]

It sounds like usury especially if it is compounded interest.

1) What interest rate are you comfortable with for a secured loan?  [4% is actually quite low for a bank loan IRL, as the current Wall Street prime rate is 8.25%.]
2) Keep in mind that compound interest goes both ways, as the interest paid on accounts would also be of the compound variety.  One thing though:  How do we set compounding intervals without a functional calendar?

P.S. A valuable weapon or glyph could be used as collateral for a loan until real estate is implemented...

[Idoru]

1) These, I assume would be unsecured loans. 4% APR is quite low, but this is 4% per day, a considerable jump.
2) The interest paid on savings would not necessarily be compound, it would make more money for the banker if it was not and that is why lots of RW banks use this system, loan out money on a compound basis but average the amount of interest paid to savers based on the average bank balance over whatever term the interest is calculated.

The collateral idea does sound interesting, like a pawn broker, if they dont pay up in the alloted time period you sell the weapon and recoup your losses

[miadon]

I believe Miadon had one going a long time ago, and it seemed to be working quite well :}

I gave that up ages ago, mainly as I had no customers, I run a gambling house now, which is very profitable.

[zanzibar]

I don't think there's a way to impliment a bank in game.   I could take out a large loan with an alt then transfer the money to another character secretively.

What could work though is a pawn shop because then you're dealing with collateral.

[Donari Tyndale]

I wonder, can i make a post to adverztize the bank in the guild section? Or do I need to create a guild first?

[Karyuu]

Feel free to make a thread before the actual creation :}