therealevan wrote: regards to in game 'banking', the only mechanics we have for actually banking is withdrawing a loan from the Government at a rate that is not fixed with only one perimeter. The principal amount from what I have observed is not reduced over time, so you will pay X amount of principal + current interest rate for however long until you get it paid off. The only two things that change is the current interest rate set by the government and the amount you owe per month. I'm not saying we need to have a financial industry expansion, I would just like to see there be more options for loans.
1) Rates should be fixed
2) Principal amounts should be paid down as you make monthly payments
3) Rates should be negotiable (principal loan of X amount, the bank will give you a higher/lower interest rate based on your corporations needs/assets/whatever)
If we are talking about mechanism of
lending interest rate to
private sector, and the types of
amortization schedule to
business secured loan, most people will be amazed by how complex they are determined by the interactions between different financial organizations and how many types existed in real life. The "Capitalism Play Book" isn't written or defined overnight, but actually "evolved" over centuries from various sources and differ in regions. The bottom line is, debts are just like "normal products", can be "packaged" and "organized" in any form the lender want, as long as customers are willing to "buy/borrow". As for what kinds of mechanism could be introduced in game, honestly without a financial infrastructure and mechanics to generate relevant background and context, all of them would seem artificial or redundant.
But adding more flavors to the lending process, or increase the degree of freedom in corporate debt controls could be
interesting and
fun. Current loan mechanics is a very abstract and continuous model (In real life, secured loan for business usually has a very long payment period). It's like a company monthly searches for a perfect liquidity financial market where it can instantly re-evaluated and transfer all its current debt to the optimal lender with an equilibrium interest rate with a new contract (thus only needs to pay the interest due in that period without principal), and keep the principal rolling indefinitely. In real life, it's a bit more complicated, and companies either need to pay a lot more to lenders due to contracts, or pay less due to prime rate or subsidies sometimes, even the lending contract itself can become a product itself (a type of swap). In general, all the financial tools and organizations provide the function of reducing risks, fluctuations, and defaults. The end result is that the liquidity although not infinite but greatly increased (in fact, some tools and mechanics are not recent but centuries old), and corporations can usually get the capital they needed in time with relatively low "cost". Most nation's central banks even track and provide statistics of current market lending interest rate.
(If you are interested, world bank gathers information and published global statistics as well,
http://data.worldbank.org/indicator/FR. ... /countries)
So for now, assume we replace the current model with a contract amortization schedule loan mechanism, then loans will be more staged-like. And since total business assets usually don't changed gradually over a very long period of time, if a player wishes to keep his/her cash level, he/she will need to go to the bank interface regularly to re-evaluated and re-borrow with new contracts to fill the principal payment due monthly. In plain sight, it would seems redundant with a disadvantage where player attention is more demanding, but there would be some advantages as well. First, the amount of financial leverage could be increased beyond simple 100% asset backed secured loan. Since new loan contract could have a higher or lower lending interests over time. An company with 100m business assets could choose a contract of 50% backed higher than market interest rate=20% of 200m loan, or 100% backed with normal market interest IR=10% of <100m loan, or even a prime loan IR=5% if player's personal cash can guarantee the principle. Second, the real nominal payment can be integrated automatically via multiple contracts and given out a gross total interest rate in financial report, so player's doesn't actually need to remember all the numbers. And finally with an additional "auto re-amortized" option allowing players to determine whether or not he/she wishes to constantly keep the principle amount re-apply for a new contract and "re-fill" automatically (with re-evaluated current market interest rate and company business asset), this modified mechanic can be nearly the same as current simple mechanism if a 100% backed full auto re-amortized loan is taken and auto re-amortized is checked, but if players deviate from norm, or choose to optimize cash-flow by manually update contracts, they can have much more options and probably better leverage
Ultimately, I think a more solid financial infrastructure is still the way to go. With a modified mechanism described above, it would be easier to add features like competing banks with different lending interest rate, or loan shark where a very small business can get unsecured loan with extremely high interest rate to start its business, or just various types of debts that have different amortization schedules, even bond-like lending from other corporations, defined by "bond trading market" (or intensest swap derivatives).