:: Twilight Banking ::

I heard this in business school too many times - If money is what you are after - be a bank.

The system of deposits and loans has become so advanced it is considered a win-win system. Obviously there were banks that didn't make it, but an average management shouldn't have a problem turning a bank into a money machine, unless they are blinded by something. And recently I have a feeling some of them are.

As Start-Ups needing cash are all over the Wadi, Banks offering a Credit Line or Debt Finance are here too, blinded by the high returns they read about in the papers. The catch is that successful Start-Ups have no problem getting the dough, it's those with less potential that address banks. And this can easily turn into a losing game.

Now, what worries me most is not the potential damage to the bank's bottom line or the fact that the suits are now playing dice. I couldn’t care less. What worries me is that at the end of the day my limited savings will be the ones called to pay the bill, an increase in the commission should be good enough. And I don't like that.

Will someone tell the banks to stop? Not a chance. None told them in the early 80s until it was too late.

Will you address your bank manager about the issue? My guess is no.

So.

So, again it's a win-win situation. If money is what you are after - be a bank, or put your savings in the freezer.

Wadi Writer #1 (Gray)

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