PicassoSparks wrote: ↑Mon Jul 25, 2022 2:25 pm
Voyager is not the same at HMBradley, for sure....
Thanks for the extra details!
PicassoSparks wrote: ↑Mon Jul 25, 2022 2:25 pm
They claimed FDIC insurance and had all the customers $$$ in a different kind of account than HMB offers through Hatch. HMB is claiming FDIC through Hatch and we do each have our own account. But there is no customer-facing way to directly interface with Hatch. So if something goes wrong with HMBradley, who are NOT a bank but are the interface to the bank, I do not know what will happen with the ability to make transfers etc.
With HMBradley/Hatch, since we have the routing and account numbers at Hatch, my working theory is we do not "need" HMBradley to access our funds.
Not sure if it was that way at Voyager, but that seems to be the primary difference I've seen with these...
PicassoSparks wrote: ↑Mon Jul 25, 2022 2:25 pm
... larger uncertainty about how the banking system deals with these pass-through FinTech's....
Many FinTech's might be using an FDIC bank, but you have no direct access, and are forced to use their app and/or website to access your money. To me - that model isn't acceptable.
But with HMBradley, my money is sitting in an FDIC account that I can access directly (via ACH). That makes a world of difference to me...
PicassoSparks wrote: ↑Mon Jul 25, 2022 2:25 pm
Voyager has failed and customers funds have been frozen since the start of the month. ...
It seems that even the Voyager customers have a good chance of seeing their bank-deposited money back eventually.
I'd be curious to know if Voyager provided the routing and account number to the underlying bank like HMBradley does... Again my working impression is since HMBradley does provide this, it's less likely things would be frozen...
But I admit, less likely does not mean zero chance. It's entirely possible they'd need to freeze all accounts if HMBradley fails, if for no other reason than to shut off any access HMBradley had to those accounts. I'm OK if this money is locked up for a bit, personally I usually only pull any out (that doesn't go back in) once a year, and if that was delayed by a few months, definitely not going to impact me (so long as I eventually get my money back, which seems to still be a valid expectation).
PicassoSparks wrote: ↑Mon Jul 25, 2022 2:25 pm
But the risk of “eventually” instead of “on demand” isn’t worth the very slight APR premium that HMB is offering.
IMHO there is definitely a non-zero risk with FinTechs (even if you get your money back as I expect) if/when they fail (as you may end up with delays getting your money).
So if you can get similar or better rates elsewhere, by all means do so!
Again, for myself, I'm not seeing alternatives that are likely to pay 3% for the next two years (roughly how long HMBradley have been doing it). I'm hopeful (for lots of reasons) that inflation will eventually go back down, which assuming HMBradley sticks around will keep them as a long term option for me.
In other words, so long as my money is FDIC Insured, I have direct access to do ACH push/pull of my funds at Hatch, the "hoops" do not become burdensome, and the rates remain amoung the highest available (on large balances), I'll going to keep riding this horse... If/when those change, I'll switch horses...
If you are only able to get the 1% rate, I'm with you - definitely time to switch horses...