At its foundation, dynamic pricing is simply flexible pricing based on current market demands for a particular product or service. It is second nature to the hospitality and travel industries, even the retail goods market, where algorithms account for competitive pricing, supply and demand, time of day, and on-demand service spikes to affect an ever-changing real time price and profit margin.
But in banking, dynamic pricing is a different story: more of a Utopic dream than a reality, with some nuances unique to the industry.
