Electronic Wire Transfer Slower Than Mailing Cash
from the behind-the-times dept
Jeremy Zawodny has an amusing post about the hassles of doing an electronic wire transfer at his bank. Not only was he unable to schedule the transfer on a delay (so it would go out a week later), but when he tried to send it immediately, they told him there would be a 48-hour delay, for the paperwork to clear. The conclusion, he notes, is that it would be more efficient to stuff an envelope with $100 bills, and send it via FedEx to the recipient. The anecdote exposes how out of date, technologically, the financial system is. Sure, you can trade stocks, set up automatic bill pay, and check your balance online, but there hasn't been much change on the back end, just the user interface is different. Some of it may have to do with regulatory compliance, but finance as a whole isn't known for regular upheaval. The same banks, payment processors, and brokerages have been in power for nearly a century. Remember the hostility when Google tried to use an alternative IPO method? More recently, wire transfer giant Western Union shocked the world when they announced an end to the telegram -- the shock of course being that they hadn't ended this years earlier. The financial industry should take a warning from the entertainment industry about what happens when you fail to appreciate technological changes. Barriers to entry, which seem so high, have a way of disappearing quite rapidly.
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Paypal
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Coming back to the N.A. banking system was hard.
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Re: Paypal
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Never again
This is beyond stupid. If I can Paypal somebody instantly, or drop a letter in a mailbox -- not even FedEx -- and have it arrive two days later, why am I penalized for cutting out all the paper? Needless to say, I haven't bothered with electronic bill pay since.
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wire transfers are expensive
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Paypal warning
http://www.paypalwarning.com/
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Japan post office has no problems with cash
genkin kakidome - this is registered mail. There is a special envelope for sending cash. You had better do it at the post office!
From
http://www.gaijinpot.com/shipping.php
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Check 2000
In other words, you used to be able to write a check two days before getting paid with the somewhat comforting knowledge that there was no way the check could hit your bank for at least three days - that's no longer the case.
What's interesting to note about this legislation is that it doesn't require a bank to post payments to your account any quicker - they can still hold even a cashier's written to you for up to ten days.
MjM
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Regulations
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The argument concerning fraud and terrororists is bogus. If I can walk into my bank, show an ID and withdraw $5000 immediatly, then deposit it in another account I own, why should a transfer be any different?
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Not for fraud..... $$$$
If I get in a wire request befor 2:00pm. the wire is done that day.
Any bank that says it must delay it is lying and defrauding you of the interest they make on your money while they hold it for the so-called fraud delay period. I would demand better service or get a new bank.
M
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paypal is ok but
I went to paypalwarning. dude. the account WITHDRAWALS money? emotional slumgulleon.
next day fed-ex cashiers check.
"Because PayPal is not regulated in the same way as a Real Merchant Account, Paypal accounts are frozen for almost anything and without warning. The account can usually receive money while it is frozen, but it certainly cannot withdrawal money."
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Money transfer oddity
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Since I work in the finance industry...
Banks are traditionally behind the ball in terms of technology. The economic incentive isn't there for them. The slower they process, the less likely they are to get bitten by fraud, the more money they make in interest, and the lower cost in hardware. Some banks don't even process in real-time, they do it all as a batch at the end of the day. Clear the checks first, then clear the deposits. Oh, you didn't have enough to clear the check before the deposit? We'll be happy to charge you a fee! It all means bigger stock dividends to the share holders.
Credit Unions are much further ahead. A lot of them allow instant access to funds, no holds on checks. A lot do instant transfers from your account at the Credit Union to other institutions, via online services. Automated bill payment services via web interfaces. They return their earnings to you, the depositor, not to some rich stock holder. You see returns in both lower loan rates, higher dividends, and better tech infrastructure (both services and security).
That being said...all financial institutions make errors. Sounds like this guy had a bad day at a bad bank. Two errors like that can make for a serious headache.
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a good bank
Also I have experience with USAA Federal Savings Bank, they allow you to set up external bank accounts that you can do ACH pushes or ACH pulls to for no fee and normally the money transfers in 24 hours.
I have my sister's bank account set up for ACH push only, she had to sign an authorization, so I can send her money any time I want to.
I have ACH push/pull with another checking account in Ohio (USAA is in texas), and again it is quite painless to transfer the money.
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Linking an account
I tried to link the second checking account and found out that the *only* way to link subsequent checking accounts is by mailing a check to the bank with a "Link" written in the memo section of a check. What? Mailing a check? This is supposed to be an online bank. I cannot even use the online billpay to write a check as it does not have the "memo" section. The only option I have is to physically mail a check.
My point is technology exists, but banks do not seem to work hard on user's experience.
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Re:
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The bank likes to sit on your money as long as possible, rather than transfer it in or out electronically and instantly which is OBVIOSULY possible in this day and age.
Recently congress passed legislation allowing them to post checks electronically and instantly, but we are still subje t to the 1, 5 and 11 day waiting periods. The only benefit to this is the 1 5 and 11 days of interest the banks don't have to pay us - the account holders. They don't even have to mail us our cancelled check originals anymore as they have been digitalized, so we get printed copies (if we're lucky).
I have started moving a lot of my cash to PayPal, as they consistantly pay more interest than any bank in the United States (4.45% currently). PayPal pays me 1.5% cash back on every debit card charge out of my PayPal account as well. They also let me move money instantly without delay to other people (I still have to wait 3 business days for an EFT tho - due to the BANKs).
The banking industry should be watching the success of PayPal and it's ease of use - over 100 million customers in a matter of 5 years noticed.....
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Brazil´s payment system is real time
could not pass by and tell a bit about what we have here in Brazil: the SPB (for Brazil´s Payment System) allows all payments made at the bank cashier or online to happen in real time for all transactions over 5000 reais (circa US$ 2100).
All other transactions take, at maximum, 24 hours (both online or offline).
The same applies to US banks operating in Brazil. All the finnancial transactions are informed to a central chamber, all the process using digital certificates.
Now, the bad part: this all happened because of Brazil having bankrupticy (is this right?) litterally. Several banks crashed in the mid nineties, making the government press the financial banks so they came out with this system. In case you wanna know more about it check out at http://www.andima.com.br/english/publications/arqs/spb_engl.pdf
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Dont you guys have VISA moneytransfer?
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Re: Dont you guys have VISA moneytransfer?
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Brazil´s payment system is real time
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Re: Brazil´s payment system is real time
I am trying to do a deal for Caixa Bank out of Brazil who wants to capture all the Brazilians living n the USA,
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Re: a good bank
Thanks for telling me about this! I use USAA Bank, and they ROCK, but I didn't realize that you could actually do ACH pulls from other banks!! I'm filling out the form right now. KICK AXX! This is going to solve a problem I'd been struggling with, on how to transfer money easily while I live outside the country. My other bank blows, they don't allow any electronically initiated transfers between banks, but I don't want to switch for certain reasons. This solves the problem. Thanks.
Jason
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Re: Check 2000
The bill collector enters all the info on the check and the bill collector's manager verifies the transaction before submitting the check.
The check is then presented to the consumer's bank and the consumer is asked by the bill collector to keep money in his/her account. In case of an NSF (non sufficient funds), the consumer is intimated and has to pay the penalty fee which is around $20-$25.
I personally prefer bank drafts. Coz theycan be encashed only by the person they're addressed to. To each, their own!
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WELL I LOVE TO LIVE AND WORK IN AMERICAN BECAUSE I
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I NEED A CLUE TO MAKE A QUICK E-MAIL TRANSFER
I NEED A CLUE TO MAKE A QUICK E-MAIL TRANSFER,PLS TELL ME MORE ABOUT HOW IT WORKS OKAY.
JOHN
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Good, I'm not the only one...
I really started getting frustrated when a family member needed an emergency $200 loan while I was out of town. Between my local credit union and my online savings account, I had several options, but none was the right combination of fast, cheap and easy. I ended up wiring money to her account, but at $18.75, that's not a good deal. And wires *still* require a human on the back-end to verify the info. We need to come up with a system that's instantaneous, easy, and free.
Let me cover some of the options in today's arena:
1. PayPal: Several people mentioned PayPal. It's a start, but as mentioned by others, PayPal suffers (or has in the past suffered) from some questionable business practices. Really, PayPal isn't a new invention: it's instantaneous because everyone holds their accounts with the same company (PayPal). The same effect would happen if everyone in the world had accounts at CitiBank--Citi allows their customers to instantaneously transfer money to other CitiBank accounts. There's nothing really innovative about PayPal except that they don't make everyone go through the rather difficult process of applying for and opening accounts--all you need to receive money is an email address. (The reason I'm not big into PayPal is that when you actually start needing the money in your PayPal account, you still need to use ACH transfers and wait three days for your money to show up in your checking account.)
2. ACH push/pull: There are two problems with ACH: one, it's slow (three days? Gah!) and two, it's only for use between accounts owned by the same person. The process of verifying accounts is still long and arduous (mailing a voided check in or waiting three days for trial deposits). It does no good if you need to bail out your kid or Aunt Sally (unless, as one poster said above, that person files an ACH push-only acceptance form--which not all banks may offer). The ACH system is a start, but it's really just a way of processing the back-end stuff without really changing the way we do stuff on the front end. Oh, and many banks charge for ACH transactions (especially push transactions)--while it may only be a buck or two, that's still enough to make me think twice about using it and writing a check instead (which surely costs them a bit in labor costs to deal with it).
3. Wire transfers: The biggest problem with this is that it's not free. It's not even cheap. The main reason is because it's not automated. Monkeys in the back room have to process the wire transfer request and send out a transfer to the receiving bank, which has to have their monkeys in the back room process the request and accept the funds. Monkeys have to be paid (expensive bananas, I guess), and also the 800-pound gorilla of wire transfer networks (Western Union) sets their fees in a monopolistic fashion. The smaller chimps follow. The other downside to it not being automated is that it only happens during daylight (bankers') hours. I can't send money in the middle of the night. And sometimes on heavy days, banks may not get through all of the wire transfer requests.
4. One of the better options involves the use of the international credit unions' shared branching network, affectionately known as the "CU Swirl" network. This network allows most anyone with an account at a participating credit union to access his or her account at any other participating credit union. It's mostly designed to let people access their accounts while out of town, but it has a hidden benefit: I can go to the teller at my credit union, withdraw funds from my account, and deposit them in an account at another credit union (whether it's owned by me or not)--all I need is the name of the other credit union and the account number. (In fact, I could even do this from a third credit union not affiliated with the other two--actually kind of scary, if you think about it. It's probably not that hard for someone to fake an ID and pretend they're you and withdraw funds out of your account...)
5. The old cash-and-carry method alluded to by a few people above. It's fast (assuming the necessary branches are within easy driving distance) and almost fraud-proof and secure (except for getting robbed at gunpoint while carrying the cash), but it's labor-intensive and certainly doesn't have that "cool" factor.
6. The European method: the second poster mentioned being able to send funds to any other account in Europe while he was in Poland. I've read just enough to guess that he's referring to the European Giro system (although it could be something else). I haven't yet been able to find much info on it, but it sounds like the Europeans are (as usual) much more advanced than we are when it comes to technical things like this. Anyone able to contribute more info on this?
Cash is still king (although reports of it being dethroned by credit and debit card usage might have some truth to them), but the main method of money transfer between people--checks--is really an antiquated way of doing it. Debit cards (especially PIN-based transactions) are much more appropriate in today's world for retail transactions (technologically speaking, PIN-based debit card transactions are more "modern" and real-time than signature-based VISA/MasterCard debit or credit card transactions, which are still end-of-day batch/ACH-transfer-based and also require a paper record), but that's not an appropriate solution for person-to-person transfers. In the future, I envision a network that allows instantaneous (real-time), free transfers directly from one account to another, using online banking (which could also be accessed from a hopefully-better-designed cellular phone Web interface to provide access to your money anywhere). But, alas, for the reasons mentioned by others--the fact that banks make money off of their slowness--I doubt this will happen any time soon. As someone mentioned, the most innovation is likely to be by credit unions (whose chief concern is their members), although I don't know if there are any sufficiently large enough to undertake developing such a system.
Just me dreamin'...
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VISA Money Transfer
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Re:
A large, global corporation like Microsoft would do about 12,000 of them per day from just ONE accounting department. Imagine worldwide. That's just one company.
Little known fact: Banks make a good chunk of change from their wire transfers fees and services plus additional fees.
Wire Transfers are good business for banks and they get it all from just Fees. No interest is necessary EXCEPT in time sensitive deposits witha accruing interest if the deposit is late and Foreing Currency transactions that are late when the rate changes over the days that it has not arrived.
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The best way to transfer money, by far
Deposit money, walk out.
Now he has it. Everyone is happy, and it didn't cost anything.
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Sending Wire Transfer from Japan to US Bank Accoun
The kicker is that the wire will take about a week to send, so now they are making more money on the float. Also they asked tons of questions like why was I sending the money (back to myself). Then they said it was too much money to be sending. Finally after the bank clerk consulted with two other managers and there was a lot of discussion and concerned noises they agreed to send it. The whole process took 1 hour plus.
Back in the states my banker types in the information for the wire, prints it out, I sign and it is done. I thought Japan was much more sophisticated financially.
Is this typical for all banks in Japan???
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Bank transfer
http://en.wikipedia.org/wiki/Wire_transfer#Wire_transfer_companies
Check out wikipedia for more information, nothing (besides legacy and/or legislation) stops the US banks from using this system, but sadly they don't.
This allows a transfer from one account in England to another to happen almost instantaneously, and usually within the same day to/from Europe.
I noticed during my stay here in America that the banking system is extremely antiquated - it wasn't until *relatively* recently that online banking with free bill pay existed here, and a lot of the time that institution still prints a paper check and MAILS it to the other institution?! This is truly amusing and yet embarrassing at the same time! :)
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Re: Keine security old technolgy and arrogant igno
FedWire is different, it is instantaneous, verifiable, and actually when the sending terminal presses the send button the actual money lands in the other bank's account.
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e-trade 5-day delay
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Bank transfer warning
My advise: use a local bank.
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Wire Transfers from Poland
Thanks! :-)
Nadia
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Orderwires.com Bad Move
-Jason
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citibank claims an international wire can take up
i called citibank and was told by them international wire can take up to 2 weeks!!! as i work for a financial company on settlement system and know a little about how money is transferred between banks, I was totally shocked.
called an old buddy at US bank who used to do domestic wire for me and told that international wire should be pretty much the same as domestic one as swiftcodes are used nowadays.
anybody who used citibank for international wire?
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Re: Bank transfer
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Re:
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Miscellaneous...
ACH transfers can be made effective the next day at the very minimum, but the bank granting access to the funds might not actually have their money yet. Ever think about that one? Your bank will grant you access to your direct deposited paycheck but probably won't receive the funds covering the deposit for another day. The ACH system is relatively quick and cheap for what it provides. Any delays in processing ACH transfers are created by your bank. My ING direct transfers take 3 days. That's a bit longer than I'd like, but I deal with it.
As for credit unions, I challenge each of you to find a credit union that pays better "dividends" than the average similar-sized financial institution. Smaller FIs rely on net interest margin to survive. A credit union can't defy this "rule" of banking. They might provide good customer service (I've been a customer of a bank, a savings & loan, and a credit union), but in reality that's about where the line is drawn. Service fees were a bit lower at the CU, but when I was an undergrad, the CU still charged me a monthly fee to have a checking account (damn minimum balances). Think about the various credit unions in your local area. How many of them have strayed from their original field of membership? From the local utility workers to everyone who might breathe the air within a 5,000 mile radius? They drop membership requirements because in order to survive, provide expanded services, and build capital reserves, they needed to expand. Credit unions are no different than any bank out there. They are motivated to provide services and make a profit. The profits are added to capital reserves and not paid out to shareholders. This comes with tax advantaged status. The credit union lobby has been quite effective at maintaining the tax-exempt status while simultaneously expanding the services that credit unions can provide (i.e. business lending). Crazy no? Credit unions are becoming banks in every way, with a toothless regulator to boot! The NCUA is the bastard child of banking regulators. Not that the others are wonderful, but the OTS, OCC, FRB, and FDIC (in my opinion) stack up quite a bit better. Don't get me started on privately insured CUs. Innovation ain't gonna happen in the CU space. It will be driven by folks like ING, Everbank, and so on that innovate in niche areas. Once other FIs figure out how they do it, they'll copy it and promulgate the new service. Just look at the number of "direct banks" that came online in the past two years. CUs are too small, too reliant on the same technology providers that provide banks with processing software, lack sophisticated risk management, and too pent up on empire-building for survival.
Just my $0.02.
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Lol
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Electronic Wire Transfer
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Is it legal to send cash under $100 in the mail fr
If I know someone there personally (not some Internet auction, store or similar)so I would trust them to tell me whether they received it or not. My only concerns would be 1 other strictly legal ones (NOT the 10,000 in or out of the US) 2. Best cost way to mail it to England. 3. Best way to conceal it in the envelope to "help reduce the chance" of it being stolen in the mail.
Thanks,
Joey
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Re: Brazil´s payment system is real time
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canada's system is excellent
in canada, fees are nominal although they exist, and as far as transfering money between banks goes, it can be done for as little as $1.50 using the well-established Interac system that is also used for ABM's and direct payment. It's a model that I wish would be adopted here. As it is, I have to write cheques to myself from one bank to another (one of my banks has no branches in California) because it would cost a fortune to send wire transfers.
Question though, can I use "Bill Pay" to "pay" myself by adding my distant bank as a payee and my checking account number as the account?
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Re: Re: Brazil�´s payment system is real time
How long would I expect to wait for a wire transfer from Brazil to New Zealand? And is Banco do Brasil the only bank that does a wire transfer?
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Broker
Another option is to open a checking account in a foreign country in which you normally do business. This can be done under some circumstances, and it is easiest to do so with a bank with branches in both countries (Citibank is the same as another bank in Mexico, for example). At that point, you can just write a check or use that bank's online system to transfer. I actually write and mail checks for a friend who lives in Finland. Transfer is much more common in Europe, and online services for this are easy to perform.
Canadian banks issue checks where the type of dollars need to be filled in. Cashing them is seamless.
I have also successfully written checks in US dollars from my normal credit union account to foreign countries. A business in Slovenia cashed one of my normal checks quite easily. (I am a scholar, so I am often purchasing reference material from other countries).
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Re: Check 2000
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Response to: Anonymous Coward on Apr 5th, 2006 @ 10:21am
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technology solution
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its good now
wire tranfer is pretty much fast now. One can use routing number and make online transactions using routing number from here https://chaseroutingnumbers.info/
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