Jump to content

Recommended Posts

  • Advanced Members

Hi! 

Here is another idea I've been thinking about for a while.

In fact, I wanted to implement these things on my quizgame site a few years ago.

 

 xat.com Bank!

How does it work? like a real bank!

 

Let's say you want to buy the latest epic power, and surprise, you don't have enough xats and you don't have the money to purchase. You do not want to sell other powers to get a new one. You love them all. So what will you do? 

Go quickly to the xat bank and borrow an amount, guaranteeing with  power/s.

You will be able to use the power used as a guarantee, it does not disappear from your account. But it will be detained, you cannot alienate it.

Also, as with a real loan, the loan will be made for a certain period of time, with installments, interest, and if you do not pay on time, the power/s you guaranteed is taken away.

What do you think? This will encourage users to buy more and get more involved in the business to generate income to pay off their loans, because, isn't it, they don't want to lose the power/s with which they guaranteed the loan.

 

  • Award 5
Link to post
Share on other sites
  • Advanced Members
Posted (edited)

In my opinion, this is a safe option (especially if you have friends who ask you borrow xats lol) however....

 

  • What if users decide to delete their accounts to evade interest? This could be a tricky problem.
  • What about if users keep borrowing to pay off their loans (like with credit a credit you can keep borrowing to accumulate a new "balance" which would override the previous balance) how would the interest work if that happens?
  • What if a user sells all their xats, days and powers then deletes their account? (before their interest is due how exactly would they charge a user then?)
  • Another thing is this might result in unnecessary legal issues i.e. would xat take the extreme to sue those who don't pay accumulated interest? (if so that would be costly for both xat and the user)

 

The system is a good suggestion which would give users more leeway to spend xats but, I think there are quite a lot of potential loopholes which can be exploited. Most likely won't be implemented due to the complexities but a good suggestion nonetheless.

Edited by Enter
  • Award 3
  • Like 1
Link to post
Share on other sites
  • Advanced Members
50 minutes ago, Enter said:

In my opinion, this is a safe option (especially if you have friends who ask you borrow xats lol) however....

 

  • What if users decide to delete their accounts to evade interest? This could be a tricky problem.
  • What about if users keep borrowing to pay off their loans (like with credit a credit you can keep borrowing to accumulate a new "balance" which would override the previous balance) how would the interest work if that happens?
  • What if a user sells all their xats, days and powers then deletes their account? (before their interest is due how exactly would they charge a user then?)
  • Another thing is this might result in unnecessary legal issues i.e. would xat take the extreme to sue those who don't pay accumulated interest? (if so that would be costly for both xat and the user)

 

The system is a good suggestion which would give users more leeway to spend xats but, I think there are quite a lot of potential loopholes which can be exploited. Most likely won't be implemented due to the complexities but a good suggestion nonetheless.

 

Well, as said in my first post, the powers with which you guarantee cannot be sold, will remain on the account until the full payment of the credit. You can't move them to another account, you can't do anything else. The account will be marked "held" and cannot be deleted to escape credit. The only option must remain to fund the account, either by buying from the store or by receiving xats transfer.

By accessing such a credit, you sign a type of agreement, by which you agree with the consequences of non-payment, ie the loss of the powers with which you guaranteed. And you can't accumulate multiple credits on the same account until you open the first one.

With these I think I answered all 3 questions.

Thank you for your concern (hug)

  • Award 1
Link to post
Share on other sites
  • Volunteers

Before I go in an in-depth analysis, I have a quick question.

 

Is the guarantee amount computed with capital + interests or just capital?

 

How do you define the interest rate? What's a consistent maturity for this type of lending? One week, one month, more? Or no maturity and the user keeps the lended power as long as he has money to cover the costs ?

Link to post
Share on other sites
  • Advanced Members
12 minutes ago, Sydno said:

Before I go in an in-depth analysis, I have a quick question.

 

Is the guarantee amount computed with capital + interests or just capital?

 

How do you define the interest rate? What's a consistent maturity for this type of lending? One week, one month, more? Or no maturity and the user keeps the lended power as long as he has money to cover the costs ?

I would see things like this:

 

Let's say you want to buy ruby and you don't have 100.000 xats, but you have gold, let's say it's worth 50.000 (for the sake of discussion, let's leave the prices easier to calculate)

 

You need to borrow 50k xats from the bank. You think about how long you can pay them, say 2 months. Then the value of the guarantee is 50k, meaning gold, as much as it is worth at that time. As with the exchange rate, gold may decrease or increase, this is the bank's risk. Why do I say this, because the bank if it gets that gold, can keep it until its value reaches the minimum value guaranteed by the user.

Coming back, you took 50k for 2 months, guaranteeing a 50k gold.

Now, the total amount to be returned will not be 50k, it will be 50k + interest.

Let's take as an example an interest of 20% of the total borrowed. please don't throw stones, it's an example, I'm not good at banking.

20% of 50,000 = 10,000 Total credit: 50,000 + 10,000 = 60,000 How many installments have been set, say 8 weekly installments over 2 months.

Weekly rate calculation: 60,000 / 8 = 7500 chats / week rate How the interest will be calculated, well, this will be decided by the bank, because banks usually set lower or higher interest rates.

Also, the payment of installments can be set at terms such as 1 week, 1 month, or all the money at the end.

 

I did not go into the accounting depths of this idea, because I do not have the necessary knowledge in the field, I presented the basic idea and it will be adapted to the needs and situations in the field of work (ie xat.com)

There are many questions, of course, what happens if the installment is not paid on time, how much the penalties increase, etc ... if xat.com will want to implement this idea, any apparent problem / ambiguity has a solution and an answer.

 

Thanks for your interest, Sydno!(applause)

 

Link to post
Share on other sites
  • Volunteers
1 hour ago, LordSin said:

it's an example, I'm not good at banking

Don't worry, this is where I come! I'm working in banking risks as a statistician, specialized in credit risks.

 

First off, thank you for your idea. For a long time I was thinking of something similar but I never went ahead. I am therefore glad to help you improving your idea with more banking insights. Before anything, I would like to remind that implementing this idea on xat would be very hard technically and may never be high enough in a priority list for it to be added, but I do 100% support this idea.

 

In the example you gave, I think the user needs to borrow 100,000 xats and not 50,000 xats. The reason is that if he agrees to block his gold power, he will not be able to sell it and miss another 50,000 xats to have enough for ruby. In other words, I suggest users cannot borrow more than what they currently have (loan to value aka LTV indicator). If you have 250,000 xats, you can only borrow up to 250,000 xats (for a total of 500,000 xats) with a 100% LTV. Therefore, if you only have gold and want ruby, you will not be able to borrow enough xats to buy ruby.

 

I would also go beyond this and include interests in the LTV. Keeping the 20% interests and 50,000 xats example: if you borrow 50,000 xats and have an additional 10,000 xats to pay for interests, you must have up to 60,000 xats in your account. The reason for this is that if you do not include interests, users will accept to be removed the capital and find a way to never pay the interests.

 

In xat terms, this can be implemented by adding a 60,000 xats reserve on the user account: their account value cannot go below 60,000 xats (capital + interests). The reserve will decrease each time a payment is issued (minus 7,500 xats per week in your example). Note that users who have powers cannot delete their account. If they have a reserve and thefore powers on their accounts, they will not be able to run away from paying by deleting their account.

 

Regarding the interest rate, banks usually put higher IR for longer maturities. IR are usually expressed yearly (at least in my country). I suggest we put a unique interest rate and a maturity up to 3 months. The interest rate can be expressed monthly. For example, for a 1 month credit, it can be 5% of interest. For a 2 months credit, it will therefore be 10,25% and 15,76% for a 3 months credit (1.05 x 1.05 x 1.05). Once the total of amount due to date is computed, you can compute the weekly balance by dividing the total amount by the number of weeks.

 

The idea is to use these credits for users to test powers at a lower cost without having to resell everything they have. To complement this idea, we could add possible moratoria: users don't pay anything for the first month but then either start to pay or cancel the credit and only pay the interests.

  • Award 2
Link to post
Share on other sites
  • Advanced Members
22 minutes ago, Sydno said:

Don't worry, this is where I come! I'm working in banking risks as a statistician, specialized in credit risks.

 

First off, thank you for your idea. For a long time I was thinking of something similar but I never went ahead. I am therefore glad to help you improving your idea with more banking insights. Before anything, I would like to remind that implementing this idea on xat would be very hard technically and may never be high enough in a priority list for it to be added, but I do 100% support this idea.

 

In the example you gave, I think the user needs to borrow 100,000 xats and not 50,000 xats. The reason is that if he agrees to block his gold power, he will not be able to sell it and miss another 50,000 xats to have enough for ruby. In other words, I suggest users cannot borrow more than what they currently have (loan to value aka LTV indicator). If you have 250,000 xats, you can only borrow up to 250,000 xats (for a total of 500,000 xats) with a 100% LTV. Therefore, if you only have gold and want ruby, you will not be able to borrow enough xats to buy ruby.

 

I would also go beyond this and include interests in the LTV. Keeping the 20% interests and 50,000 xats example: if you borrow 50,000 xats and have an additional 10,000 xats to pay for interests, you must have up to 60,000 xats in your account. The reason for this is that if you do not include interests, users will accept to be removed the capital and find a way to never pay the interests.

 

In xat terms, this can be implemented by adding a 60,000 xats reserve on the user account: their account value cannot go below 60,000 xats (capital + interests). The reserve will decrease each time a payment is issued (minus 7,500 xats per week in your example). Note that users who have powers cannot delete their account. If they have a reserve and thefore powers on their accounts, they will not be able to run away from paying by deleting their account.

 

Regarding the interest rate, banks usually put higher IR for longer maturities. IR are usually expressed yearly (at least in my country). I suggest we put a unique interest rate and a maturity up to 3 months. The interest rate can be expressed monthly. For example, for a 1 month credit, it can be 5% of interest. For a 2 months credit, it will therefore be 10,25% and 15,76% for a 3 months credit (1.05 x 1.05 x 1.05). Once the total of amount due to date is computed, you can compute the weekly balance by dividing the total amount by the number of weeks.

 

The idea is to use these credits for users to test powers at a lower cost without having to resell everything they have. To complement this idea, we could add possible moratoria: users don't pay anything for the first month but then either start to pay or cancel the credit and only pay the interests.

This answer is very detailed and comprehensive, for which I thank you. Although, as you said, xat.com will probably never implement this, being quite difficult. 

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.