WOW: Need suggestions for my latest money making scheme

So at work when I’m bored, I try to come up with get rich quick schemes for my Gnome. I wonder: is it possible to run a profitable player bank in World of Warcraft?


  1. Historically, running a bank is pretty damn lucrative.
  2. The great thing about virtual economies are that (sometimes) your transaction costs are low, you have extremely high network effects, and the first mover wins everything.
  3. So you should be able to make a shitload.


  1. Who the hell would want to borrow money from you at interest? That is, who would do it with the intention of actually paying you back?
  2. Even if they did, to be really profitable you have to increase everyone’s earning potential by doing this. I really don’t think cash makes everyone that more effective at leveling & (most importantly) farming mobs for shit to pay me back. Am I wrong about this?
  3. How would you get them to pay you back? A system of trust would last about 35 seconds.

I guess I can leave con 1) & 2) for the moment to be resolved by experiment, which leaves 3). So, let’s run with that one.

  1. Bond model - regular small payments, big lump sum payment at the end.
    1a) Good: easy to get small payments out of people, maybe.
    1b) Bad: Fucking impossible to get that big final payoff. I guess you could “roll over debts” at ever more extortionate rates, but I’d rather not cause the first WOW great depression with a credit crunch.

  2. Installment loan model - regular payments that pay down the principal.
    1a) Good: somewhat less easy to get the payments out of people than bonds.
    1b) Bad: Just the underlying “make them pay” problem.

Ok, so to make them pay, we need some sort of seizable collateral. This is a bit of a problem. I could just demand items for deposit, but that gets into more trust issues. Can’t we offload trust to the computer?

There’s got to be some way to do this. You can even lock everyone else out of your auction, for all intents and purposes, by having one party but a really stupidly high bid on an item, but that would seem to screw up the ratios on deposit to loan. I can’t quite figure out how to get around the 24 hour auction time issue, though - maybe petition blizzard for week-long auctions?


  • Initial funding for the bank.
  • Reserve requirements? Transparency?
  • Probably need inflation hedging.
  • (God help me) Credit ratings! -20 points for a name variant of Legolas! +10 for a respectable guild name!

(Joking about all this. Mostly.)

Ok, so collateral is technically doable:

  1. I loan out 10 gold.

  2. I want payment of 1 gold a day, for 12 days.

  3. For each day I’m not paid, I take 20% collateral of that day’s payment.

  4. How can I do this?

  5. I put up a commodity item on the AH, and the debtor puts an absurdly overvalued bid on it.

  6. Need to get the ratios right, so in this case we’d have to do something like a 2 silver item, but have the debtor bid 20 silver on it.

  7. If they make that days payment, I cancel the auction. If they don’t, the auction goes through and I get my money.


  • Have to log in every day.
  • Already too complicated for the masses.
  • Strong temptation to screw the bank on the first day - maybe require hefty collateral up front, but less for days further out?

I had this idea as well, and enforcement of a repayment is where I got stuck. You could try and get yourself backed by a bunch of level 60 PvPers – but that has limited fun and effectiveness.

I didn’t think of using the AH as an escrow. That’s a pretty good idea. The 24 hour thing bothers me as well, particularly when you’re talking about a good item for a big loan – the deposits on the repeated auctions might very well eat up any interest.

Right now, my latest money-making scheme is speculation through automation. I’ve heavily modified a couple of well known Auction mods to give me reports on the best bid potentials along with the capability to set up the bidding for me. I’m working on additional features to track outbids and rebids (along with declaring a threashold and keeping tabs on my funds). I just started seriously playing with it today, and were it not for some infuriating problems at work, I would have made much more than the 14g I netted in the couple of hours I got to play.

I am envious, I keep wanting to get around to writing an autoshop bot. For god’s sakes, don’t let that thing get out in the wild!

This assumes that I’m not just /ignoring you and taking your money.

Not likely – although I hold no illusions that I’m the only one who thought of it.

In fact, if you have Auctioneer installed, do a lootlink scan and then type /auctioneer bargains. Norganna hasn’t advertised this feature, and it’s quite unwieldy – but it’s very enlightening as to the kind of information you can extract.

For the bank to work I suggest you contact the recipient irl to find out their adres and stabbing them to death if they don’t pay up.

I’ve been running a player bank on Stormrage for the past month. I call it “Leeah’s First Realm Bank of Lagforge”.

I make unsecured loans to players so that they can buy mounts, and ask that players give me a tip (value at player’s discretion) after they’ve repayed, so that I can make more loans to players who need mount money. 90% of players are great, and make payments without having to be asked. The other 10% are really bad at it.

It’s a pain in the ass, because all you can do is ask politely for repayment.

So, how much profit have I made after lending out over 500 in gold over the past month, and having to dog that 10% for repayment?

10 gold, minus the 50 I need to collect from the deadbeats.

Stick to the coarse stone. :-)

If you had a simulation style MMORPG with an economy that worked remotely like the real world, actual risk, etc. then a Bank would work great. But WoW is nothing like that.

In a real economy getting a loan lets you do things you otherwise could not (buy a house, start a business, etc), and buying loans cheap and selling them high is basically how banks exist. In WoW, what is there that a loan could possibly get you that you otherwise could not get?

I ran a player bank in a MUD. Here’s the way I set it up…

#1: Each loanee is analyzed for repayment odds. The worse the chance of repayment, the less likely any loan will be given, and the lower the limit of outstanding debt that is allowed.

#2: Every successful loan (one that is repaid per contract) gives that player the ability to receive a greater loan in the future, since they have reduced their perceived security risk.

There is a lot of “paperwork” in terms of tracking the loans and tracking the analysis of the players. I ran the bank not because it was particularly profitable, but for the fun and experience.

That MUD allowed for bounties to be put out on players and the PK system had substantial penalties for death (unlike WoW). Also, I ran a large guild and could call upon guildmates for help in collecting unpaid loans. All of this makes a bank much more practical in that game than in WoW, where even creative players have many less tools to enforce repayment. I had more problems collecting guild taxes.

In terms of practical analysis of whether a bank is important in WoW, you have to determine who needs money, for what reasons, etc. Here’s the way I see it…

Type A: The Newbie

Money is tough to come by for a newbie who is not guild-affiliated early on. One of the big issues is bags… newbies can barely afford 6 slot bags and if they do spend the cash on that they are really hurting for even enough money to pay for new skills. Yet newbies have almost as much need for bag slots as level 30s.

Low Limit Loans can be provided to newbies to pay for bags (enough 6 slot bags to fill their spots). Better yet, part of the loan can be in bags provided by the lender, who can get them at the AH at considerably cheaper prices, then forwarded to the newbies through the mail. Since this is a very helpful service, high interest rates can be charged. I know I would have benefitted from this service and been willing to pay high interest rates if such a service had been available to me.

Its a very high risk loan since the lower level the player, the less likely he will continue to play that character, thus making him less likely to be available to repay the loan. High interest rates are necessary to cover the many players who do not repay, as well as the high transaction cost to profit ratio (the amount of time and paperwork is comparable to a higher profit loan).

Type B: The Auction Broker

As an Auction Broker myself (I transfer goods between undersellers and fair buyers, acting as the corrective middleman) I know the need for working capital. Right now the Auction Broker has to build his capital through adventuring, and very limited Brokering (low price goods which he has the capital to afford). A loan allows him to expand his Brokering range far earlier than he otherwise would, increasing his profit and therefore the loan value, thus again allowing for fairly high interest rates and thus banker pleasure.

Oversight of the loan includes checking to make sure the Broker is really Brokering (he would have to include which items he is actively Brokering). Also, just as with the additional Newbie Service of the AH bought bags (to lower cost), the newbie Auction Broker can be given advice and guidance, thus raising his profit rate and the interest rate he can be charged.

Type C: The Level 40 man with no mount

A mountless Level 40 reality leads to embarrassment and feelings of inadequacy. Who wants that? In to save the day comes Banker, who provides a legitimate means of mounted happiness.

The good news is that since the player is already at a fairly high level, the odds of him staying in the game are much higher than for either of the other types. The bad news is that Level 40 is such a landmark point that many players don’t make it far over the hump.

More good news is that most of these players are members of guilds, and you can build into the contract that the guild is responsible for repayment of the loan if the player defaults. The larger and more respectable guilds are more likely to repay.

Type D: An Epic Desire

Some players want that Epic item they see at the AH, but just can’t afford it. Many of these players are high level, lowering their security risk. Loans should be made available to them, again with the Guild repay addendum. As a further service, use Brokering skill to determine whether the item in question is a good deal or not, and encourage proper action from the loanee.

The idea behind typecasting the loanees is that it creates a framework of legitimate loan reasons. Its important that a good reason exist for the loan, or it makes it much less likely that the loan will have a good outcome (repayment).

Furthermore, if a player fails to repay a loan its a black mark against his entire guild (with respect to obtaining loans and with respect to any injury you can inflict), unless that guild repays the loan. Through this you increase the world-logic and shared responsibility and your own integrity.

One of the keys in making banking a success is advertising. Word of mouth will help at some point, but getting the news out there about what your Bank is all about is huge. A good way to do that is to get a link to it off Blizzard’s WoW website or, which leads the curious to information and bank structure and how to contact the banker in-game. Also, advertise at Ironforge or Orgrimmar about your services.

I’ve always been hoping that Blizzard implement some sort of bounty system. It could be treated as a quest so that you are either rewarded with money by the player who puts it up or some important NPC in the local area. It would have to be restricted to levels and other stuff like that so that it wasn’t totally abused from day one, but if there was a bounty system I think it would actually make player-run banks (And other similar ventures) a far more plausible idea in WoW.

“Pay up or I’ll hire a lvl 60 to whoop your ass.”

Forget a bank, start a credit union and only loan money to people in your guild. That way you can get the guildmaster/whatever to threaten to kick them out and blacklist them if they don’t pay.

Also, instead of using the AH as escrow for items, why not use the mail system? They mail their piece of collatoral to you and you just keep it in your mailbox. If they pay the loan back, you return it in the mail (advantage: you don’t have to both be online at the same time and in the same place as in an inventory trade). If they don’t pay it back, you move the item from the mail to your inventory.

I don’t see how there’s any way to enforce payment. A collateral system doesn’t work. If the collateral is worth less than the loan, obviously you’re going to get conned by unscrupulous players. If the collateral is worth as much as the loan, the person wouldn’t need the loan in the first place because they could just sell the item. Sure, maybe the item is some cool thing that they don’t want to sell–but if that’s the case, are they really going to give that item up (even for a limited period) just so they can buy some other, equally-valued item? I think not. Add to that the fact that for most players, most or all of their really good items are soulbound, and you’re in a real pinch.

Using the AH as escrow seems unworkable. You have to force the debtor to bid a certain amount on your item, as I understand your system. If you can’t force him to pay you directly, what makes you think you can get them to put “an absurdly high bid” up on a commodity item? It’s like you have that “and then a miracle occurs” step in your plan. Step 3: PROFIT!

It seems like the only real option is to make unsecured loans and charge high enough interest to cover your risk. Except that I don’t think the market will bear that, especially since as you increase interest, you increase chance that people will default.

You could always get a deposit of real-life money out of the game via Paypal. That would probably get people to pay you back. And if they don’t, then great!

Well, crap, fine. DEADLY WOW MAFIA IT IS.

IGE has gold down to $21 per hundred, so even real money might not work.

None of the proposed ideas here, AH escrow, mail system, etc, are really offloading trust to the computer. In most cases, you’re just shifting the burden of trusting someone to the other person. They still have to believe you won’t just take their item when they mail it to you before you loan them the money, or believe that you really will cancel the auction they put a huge bid on, etc.

When I was trying my Gadgetzan Shuffle (Transfering wealth between Alliance and Horde with a ridiculous bid at the Gadgetzan AH and paying someone else the money to buy it from your alt), I was faced with the same dilemma of finding a way for the person to not just run off with the 10g I needed them to go buyout my alt’s auction with. Ultimately, there was no foolproof way, just trust and minimizing and dividing the risk. I asked if someone would like to make 2g, got several responses, several of which backed out when they found out it was going to help the Alliance (I applaud their loyalty). I had a couple of people still willing to do it, one of them wasn’t there at the moment, so I went with the first guy. Told him I’d give him 6g up front, then he’d go buyout the auction I had set at 10g, then I’d give him another 6g, leaving him up 2. He said ok, I gave him the 6g, at which point I was risking losing 6g. He bought the auction, at which point he was risking losing 4g net if I just ran off. Then I gave him the last 6. At no point till the end of the transaction was there a step on either side without risk involved. Then because I was feeling charitable, I mailed 1g to the other guy who’d volunteered to help.

But yeah, I don’t see how any of the current systems like the AH or mail can possibly work as an escrow or offload risk.

You can overcome the Gadgetzan trust problem specifically if you happen to have two accounts (in my case for example my sons play so I have mule characters on their accounts).

But be careful if you’re thinking of setting up an “arbitrage” business on your server. The following from the WoW site:

All auctions will be initially charged a deposit fee. The deposit fee is refunded upon the successful sale of the item. All successful sales are charged an auction consignment fee which is extracted directly from the final sale price. All fees are higher in Gadgetzan…

It turns out the Gadgetzan “consignment fee” is 15%, so woe to all those who didn’t experiment with small amounts before trying to whop the whole 50 gold over.

Too bad, really, because an arbitrage business would have been lots of fun: I had mules ported into Gadgetzan on both factions all ready to go, plus a mule in Ironforge to handle my affairs there (my main is a Horde character). I was actually going to enjoy all the logistical hanky panky this was going to require, but really it’s pretty damn hard to overcome at 15% bite in each direction on anything but the direst of price differentials (there ARE times when Linen seems to be selling for 40s in Ironforge while the BUYOUTS in Orgrimmar are 6-8s, but the profit margin remaining just doesn’t seem worth all the extra trouble).

I haven’t tried the idea of having two accounts running on two COMPUTERS and quickly moving stacks of cheap commodities in auctions for 1 copper, risking a snipe from someone who gets very lucky but possibly end-running the consignment fee which is apparently based on final sale price as opposed to the perceived “value” of the goods. Somebody get right on that and let me know how it turns out…

Well. I’m reluctant to divulge trade secrets in an open forum, but I love you guys, and I already have my epic mount. So I’ll just say this:

Arcane Crystals are virtually duty-free. The rest is left as an excercise for the student.