Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Fed announces details of new interbank service to support instant payments

federalreserve.gov

Post reply on HN
Print view View original

281–290 of 431 posts

Re: Fed announces details of new interbank service to support instant payments

#281

Post by antihero »

boruto wrote: post #274
antihero wrote: post #272

Earlier quoted context omitted.

A whole day? That's absolute madness. Why does it take a day when money is electronic and nothing has to physically move?

The basic working is this, you give a SEPA transfer order to your bank in the afternoon. Your bank consolidates all the transfers for the day in a big XML file and puts it in an ftp server in the evening. Bundesbank pull it from there and puts the XML file in other banks ftp server. Other bank pull it from there and completes the transaction. In case the account does not exist or something happens the whole thing has…

Man the EU really needs to mandate compliance with SEPA Instant. Quite tragic that three years later and customers are still waiting on batch processes. FPS really is lush.

Re: Fed announces details of new interbank service to support instant payments

#282

Post by cowsandmilk »

djsumdog wrote: post #214
woodruffw wrote: post #39

Settlement between banks in the United States is astoundingly complicated, for (fascinating, terrifying) historical reasons. FedNow is a huge step towards fixing holes that private companies have been papering over for over two decades. Blatant self promotion: for anybody interested in learning more about the Automated Clearing House system (which FedNow will eventually supplement) and interbank settlement in general…

My first job out of university was working for a debt collection firm that made its own ACH engine in Perl. I remember all the 99999s and headers and stuff. I didn't work very much on the engine though (thankfully). I was pretty shocked at just how far behind the American banking system was when I lived overseas for a bit. I wrote about it here: https://battlepenguin.com/tech/the-american-banking-system-i...

Your blog article is startlingly incorrect pretty early on. Individuals can and do use ACH between each other all the time. It is literally how paper checks work in the US. And I’ve been able to use a routing number and account number to send money to someone else online via ACH for decades...

Re: Fed announces details of new interbank service to support instant payments

#283

Post by raxxorrax »

koopuluri wrote: post #216

I moved to India at the start of the year and there's the Universal Payment Interface (UPI) here that essentially allows a Venmo like interface to transfer $ instantaneously from any bank account to another - by simply using the recipient's phone number or a QR code. There are multiple apps that interface with UPI, and the barrier to entry isn't high - allowing for good competition on the UX. Literally every person I…

They made cash almost illegal allegedly to fight corruption, but I think that has an awesome UI.

Of course the poorest were strongly hit by declaring the currency illegal. Some negligible UX experience wouldn't be my first thought on the issue

Re: Fed announces details of new interbank service to support instant payments

#284

Post by iagovar »

patmorgan23 wrote: post #105
nucleardog wrote: post #86

Earlier quoted context omitted.

I wouldn’t say Canada is “far behind” because the banks like to rip people off. We’ve had a single unified payment network for like 40 years. We’ve had instantly settled electronic transfers (Interac e-Transfer) exposed to consumers directly through their institutions for about 20 years. We’ve had chip and pin and NFC contactless payments for quite a long time. And the rip off is really just the handful of big banks.…

The US has a unified payment system (ACH) and has had it for many decades it's just not instant, usually takes 3 business days for a transaction to fully settle.

So why isn't ACH used widespread?

Re: Fed announces details of new interbank service to support instant payments

#285

Post by xyst »

Assuming all banks adopt this standard in that specified timeframe, the existing P2P solutions (Apple Cash, Venmo, PayPal, Zelle, CashApp) will ultimately become useless.

I wonder how these companies will pivot once banks begin to adopt this interbank service.

Re: Fed announces details of new interbank service to support instant payments

#286

Post by kalleboo »

pjg wrote: post #176
crazygringo wrote: post #101

Earlier quoted context omitted.

As a general rule, the US is terrible at a lot of first-world things for a good reason: because it was the first (or close). We have crappy old subways, airports, bridges, skyscrapers, and so on... because we built them early, versions 1.0. And they stuck around. Other countries had the luxuries of building their versions decades later, when the technology was 2.0 and 3.0 and so on. So the US is stuck with both old a…

There is another reason. This is very specific to the way USA does things. It has to do with the role of the government vs. market. Other countries also had an antiquated payments infrastructure e.g. Cheques in Britian, Scandinavian countries etc. The government there simply mandated the dozen or so banks to come up with an instant/real-time payment system and it was rolled out in a few years US has more than 10,000…

The same day and instant payment systems in Sweden were initiated and are owned jointly by major banks, and were not government-initiated. Specifically the Swish mobile payments started with a very small number of banks and it has been a race for other banks to join to stay competitive.

The main digital ID system was also made and is owned by the banks. The government just set legal standards for digital ID to fulfill to be legally valid, there were a few competitors (including one by a phone company), and the bank system won because everyone already had strong digital ID for internet banking.

The EU-wide international systems, however, have been pushed from above from the EU

Re: Fed announces details of new interbank service to support instant payments

#287

Post by perlgeek »

throwaway9d0291 wrote: post #256
koopuluri wrote: post #216

I moved to India at the start of the year and there's the Universal Payment Interface (UPI) here that essentially allows a Venmo like interface to transfer $ instantaneously from any bank account to another - by simply using the recipient's phone number or a QR code. There are multiple apps that interface with UPI, and the barrier to entry isn't high - allowing for good competition on the UX. Literally every person I…

> I felt like I stepped into the future. It's more like stepping out of the past. It's not that India is particularly ahead, it's that the US is particularly behind. The EU for example has essentially instant SEPA transfers now and has done for a while.

> The EU for example has essentially instant SEPA transfers now and has done for a while.

It seems that for me (in Germany) transfers still only arrive the next business day. Something must be going on there...

Re: Fed announces details of new interbank service to support instant payments

#288

Post by withinboredom »

djsumdog wrote: post #214
woodruffw wrote: post #39

Settlement between banks in the United States is astoundingly complicated, for (fascinating, terrifying) historical reasons. FedNow is a huge step towards fixing holes that private companies have been papering over for over two decades. Blatant self promotion: for anybody interested in learning more about the Automated Clearing House system (which FedNow will eventually supplement) and interbank settlement in general…

My first job out of university was working for a debt collection firm that made its own ACH engine in Perl. I remember all the 99999s and headers and stuff. I didn't work very much on the engine though (thankfully). I was pretty shocked at just how far behind the American banking system was when I lived overseas for a bit. I wrote about it here: https://battlepenguin.com/tech/the-american-banking-system-i...

It's even further behind. I still live overseas and use a US bank account for paying taxes, etc. I'm still shocked that it costs me, my family, or someone money to send money instantly. Here when we go out to dinner with friends, someone pays the bill and we settle it with bank transfers within moments.

Re: Fed announces details of new interbank service to support instant payments

#289

Post by skrause »

perlgeek wrote: post #287
throwaway9d0291 wrote: post #256

Earlier quoted context omitted.

> I felt like I stepped into the future. It's more like stepping out of the past. It's not that India is particularly ahead, it's that the US is particularly behind. The EU for example has essentially instant SEPA transfers now and has done for a while.

> The EU for example has essentially instant SEPA transfers now and has done for a while. It seems that for me (in Germany) transfers still only arrive the next business day. Something must be going on there...

There are normal SEPA transfers (taking between a few hours and 1-2 days) and there is SEPA Instant which transfers the money within a few seconds. Those are two different systems and not all banks support SEPA Instant yet.

I've done a few SEPA Instant transfers in Germany already and they really arrived within a few seconds to a few minutes.

Re: Fed announces details of new interbank service to support instant payments

#290

Post by J_tt »

throwaway9d0291 wrote: post #256
koopuluri wrote: post #216

I moved to India at the start of the year and there's the Universal Payment Interface (UPI) here that essentially allows a Venmo like interface to transfer $ instantaneously from any bank account to another - by simply using the recipient's phone number or a QR code. There are multiple apps that interface with UPI, and the barrier to entry isn't high - allowing for good competition on the UX. Literally every person I…

> I felt like I stepped into the future. It's more like stepping out of the past. It's not that India is particularly ahead, it's that the US is particularly behind. The EU for example has essentially instant SEPA transfers now and has done for a while.

Australia and New Zealand have Osko, which is instant and supports Unicode
Post reply on HN