Management Accounting Research on Bank Account Fee: Applicability of Subscription Model

Abstract

Account fee (account fee) is generally applied in overseas banks. On the other hand, there is no place where domestic ordinary banks set account fee. However, in domestic banks, the profitability has declined considerably due to the declining birthrate, aging of society, direct financing, intensifying competition from other industries or from foreign countries, and negative interest rate policy, so the profitability is declining significantly, It is difficult to predict that it will grow significantly. Also, in recent IT industry cloud services, the subscription model is common. Therefore, domestic banks will be able to apply account fees if they are subscription models, which will contribute to improving profitability.

We performed a revenue simulation with the account fee of the subscription model and actually visited several banks and verified it. As a result, although applying the account fee by the subscription model can theoretically be considered sufficiently, it turned out that there are still some problems to actually introduce. However, the account fee by the subscription model is the primary objective of maximizing customer service value, which is completely different from conventional account maintenance fee. Account fee based on the subscription model may be a so-called “strategic account fee” that emphasizes hospitality unique to Japanese banks in the FinTech era.