Banking Services Can Get Cheaper For Consumers

This article will talk about how to get better terms for your financial services by buying them all from the same provider by using the concept of synergies and economies of scale. It seeks to provide tips to people to save money on their financial services needs.

Some countries have laws that separate various financial activities from being run by the same company. Other countries are more open when it comes to this issue. If you live in a country where your Bank also offers credit card services and insurance, then you should take advantage of that and apply to the same place for all your financial needs. That way, you can negotiate premium rates, deductibles, credit limits and bank fees. This gives the consumer leverage in dealing with their financial institutions because if they don’t keep you happy, then stand to not only lost your bank account but all the bundled services as well.

But of course, the flip side of this is that financial companies that engage in shenanigans would be more likely to fail and take down their customers hook line and sinker. So if your financial institution were to fail, your bank account, insurance, loans and all other financial products would be affected. It is kind of like putting your eggs in one basket. Sure, you don’t have to carry multiple baskets but then it does get a little risky. So how does it all work? How do you actually save money? Well, it is simply what economists like to call economies of scale.

Certain infrastructure costs are incurred by a company every time they take on a new customer. The new customer needs space in the database program, they require certain staff to take care of them, they require inches of space in the file cabinets of the company etc. If there are three different companies that are dealing with one customer then all those costs are repeated in each company.

But all in all, if the banks are backed by some kind of government insurance, then you don’t really have much to worry about. So, go ahead and buy your insurance from the bank that provides you all your other services and make sure you negotiate and let them know how you are a loyal customer. Businesses thrive on negotiation and they will respect you more if you settle for a good deal rather than accept just any rate they give to you.