Money and banking in online games

There aren’t banks because trading gold is illegal. Its as simple as that.

Well, one thing to note here is that this post isn’t specific to any one game: yes, in World of Warcraft, trading gold between the “real” world and the online world is illegal, but contrast that with SoE’s Station Server where it’s encouraged, and in fact is the entire basis for that server. I think that most people on that server, and in fact most people who play EverQuest II would chalk that up as a success.

This post is about putting your IN-GAME money somewhere safe, rather than putting your out of game money into the game’s economy by buying gold from IGE or other farmers.

Just a thought, say mr newbie comes along and loans enough for his mount.
In a month he gets bored with the game and quits.

where does that leave the bank?

Here’s some stuff from the comments section on Digg (posted, of course, in vain):

One thing, though, that would be markedly different from a real economy would be that the game should be able to digitally track every unit of currency, unlike a real economy. You’re right; people stop playing games, they default on their loans, and in general, shit happens. However, with a fine level of *active* control by the monetary authority (the game designer), the actual supply of money and this interest rate could be tweaked to make up for the loss in loans. Further, since the banks would probably have a sort of “black box” appeal to them, a defaulted loan could simply be paid back by the gaming authority, at a small hit to the interest rate for further investors (in the short run).

I guess I was thinking more of a “big brother” monetary system rather than a monetary system governed directly by the players. The players can use it as an intermediary, but, much like the financial system of the United States or any other developed countries, it wouldn’t be directly controlled by those players, and the “government” (in our case, the game designers) would have the final say in those sort of matters.

Well one thing I see wrong with this is that there need to be money sinks in the game. In the real world resources are not infinite. In the game world, a GM can just click a button or two and make a near infinite amount of gold. Resources/money are constantly created out of nothing, which just devalues the gold. Which is exactly why in World of Warcraft things are ’soulbound’, resources get permanently used up and at the same time get created out of nothing , like the mounts in WoW, once you buy it, its worthless to anything but yourself.

I just see creating currency without any
‘work’ or ‘resource’ attached to it would make the economy lob sided.

ok heres my 2 cents… Second Life is the only MMORPG per-say that has real money and banks in the equation. i think we should keep it that way. WoW and every other game out there has their own system or currency and once again, lets keep it that way. If these games have made it this far, then they must be doin it right

I’ve also wondered about this same principle, along with player-created structures and transportation systems. I would find it great if players could create transportation systems between cities at a cost to them but include a minor fee for each individual that utilized their transportation system. It’d also be neat if players could create an arena/ring for dueling/sparing and perhaps have bracketed rounds and such. There are so many possibilities in MMOs that just aren’t taken advantage of either due to developer limitations or the possibility of abuse.

There are going to be banks in entropiauniverse.com. Five banking licences have been sold.

1) There is no guarantee that the money will continue. Until games guarantee that no matter what, the money in circulation will stay in circulation (or your possession) no matter what, there will be no banks.
2) There’s no controls on inflation. Gaming companies could flood the market with cash, and suddenly the value on your loans and their returns is worthless.
3) There’s no feasible way to calculate a player’s credit score. Unless you know what kind of risk you’re taking by giving a loan, you can’t accurately calculate how much interest you need to charge in order to make money on it.
4) There’s no feasible way to collect.

This is a preposterous idea.

MMORPGs will never have banks, but are a great place to launder your money.

I think that if you had an in game bank it probably wouldnt do so hot in multiple ways. For starters, mentioned before, there is no way for players to be honest so if you get a loan and then quit the game you never pay it back. Also what happens if you get the gold on a loan and send it to a friend so that he can have a large amount of gold comeing in on interest. It throughs the game out of balance because then you have one guy with a million gold in his money market making some 100 gold a day on interest. He then continues to purchase all the raw trade goods he can from an auction house or other people, and then continues to sell them for twice the price.

Eve allows for loans, and investments.

Just like the real world though you can lose your shirt.

FYI there were banks. Star Wars Galaxies didn’t have an in game system of banks as you describe, but it did allow for a player or a guild to create a banking system. My guild created a banking system and loan operation to help people acquire things they needed. It was great. It worked like a real bank only simplified.

So in a real MMO this duty of creating a bank of sorts should fall on the players backs not the devs.

Simple:
In America there is a limited amount of currency as a whole. In a MMORPG there is an unlimited potential for cash which is why in some games (Tibia comes to mind) we experience much unbalancing in prices.

The bank would be bankrupt in short order.
1. Create character, take out max loan.
2. Mail/give money to another char.
3. Delete character with loan.
4. Repeat as necessary.

In my experience loaning money to other players has been very hit or miss. At this point I think I am out close to 500 gold on WOW. Mostly this is due to the people I have loaned money to quitting etc. so I don’t really consider it an integrity issue. And I have had many loans paid back, but the bad experiences have made me treat any “loans” as gifts instead so if I get paid back all the better, but if not I wasn’t really expecting anything back.

Back to my original point though, if you try and work around the above scenario by restricting what characters that have already taken out a loan can and can’t do it would hurt the game in general. (I.e. can’t delete char till debt is paid (then people would just leave dead alts lying around), tie the loan to the account instead of the char (no way to force pay back), automatically remove gold from defaulting chars (then the game is much more like a “job” and less like fun, players would start quitting when they log in and have zero gold))

I am not sure the gaming community is ready to accept restrictions on their play that setting up a viable banking system would require. I would much rather have no restrictions and things work the way they do now, even though that means no official loans, and no easy interest.

As people mention it’s the loans that are the problem, if there are any. A player could give his coin to another then default. Even if code could be written to automatically tax players, could the bank just take the money a 3rd party? Well I guess the company makes the “law” so they could. heh.

You know what, what about instead of depositing money and getting interest, players themselves can act as bankers/angels/venture capitalists for NPCs? You can go to the town, see which NPCs would like to borrow money, and what they will do with it. There might be feedback on that NPC, from players or maybe scripted feedback from other NPCs.

what the deal is though: say the NPC needs money to move cattle from one town to another. Not only can the Player loan him money, but this creates quest and activity opportunities: maybe the NPC needs help protecting his cattle, so the PC helps protect his investment. If the PC doesn’t, there’s an increased chance to lose his money. Each loan would come with an escort or protection quest, or maybe retrieve a rare item, with a greater chance to get his money with interest if the player decides to help.

Hmm it’s fun way to teach people how investing and risk work, while creating new content for them to play with.

If you actually read the article, you’ll notice that the loans, just like in real life, are coming from deposits that other players have made at the bank.

So, no, it wouldn’t contribute to inflation in any way. The only way it could contribute to inflation is if they gave out money that they didn’t have.

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