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What Happens When You ACH a Dead Person?

moderntreasury.com

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Re: What Happens When You ACH a Dead Person?

#31

Post by wereHamster »

lettergram wrote: post #19
grecy wrote: post #15

Earlier quoted context omitted.

Moving from Australia to Canada/US felt like going back in time 20 years when it came to banking. Even ten years ago in Australia I could do more with my online banking than I can today in North America. Checks are for what now?

I use checks all the time actually. Every other form of payment online is “pull”, I only want to “push” my funds to external people.

> Every other form of payment online is “pull”, […]

Wat? When I transfer money to another account via my bank's ebanking app that is very much "push". The transfer is executed either immediately or at the end of the business day. Nobody is pulling anything.

Re: What Happens When You ACH a Dead Person?

#33

Post by munk-a »

tjpaudio wrote: post #7
s9w wrote: post #2

Neither the title of this post nor the article explains what ACH is. And it somehow got 15 points in 6 minutes or so. Am I missing something? edit: yes, downvote me to -3. I love you all

The article is written for people interested in the very specific topic of the technical workings ACH transfers. It seems absurd to me that you would try to write this article to an audience that hasn't even heard of ACH. I think the only thing you are missing is that you are not the target reader.

Elitism is no reason to avoid having a definition of jargon. HN has discussions on a wide variety of technical topics most of which aren't directly useful in our day job - or at least on the topic of information we'd seek out independently... But we have this list in part because intellectual curiosity is a good thing and maybe, within the way that whatever an ACH is deals with a dead person, there might be some interesting logic that you could apply to your own field.

If someone submitted "How I managed to emulate Super Mario in C without using more than 30 Kb of memory" I'd be super interested and look to see what sorts of crazy pointer tricks or unioned structs were in use - even though I don't currently work with games or C in my daily.

Re: What Happens When You ACH a Dead Person?

#34

Post by nickjj »

itcrowd wrote: post #12

This reminds me of a question I've had for the longest time (+): why is it that in the US wiring money between accounts is so expensive or difficult? Whole ecosystems of companies have sprung up (PayPal and Stripe come to mind, and apps such as TransferWise) to reduce the friction when the banks could easily set up a way cheaper system that would actually be better (privacy etc.) for the consumer. The EU seems to be…

Zelle[1] is a fairly recent solution to that problem.

Free and nearly instant email address based transfers directly through your bank account without having to sign up for anything extra. I've done a bunch of transfers with it and it's been solid.

It's about as easy as you can get and most US banks support it.

[1]: https://www.zellepay.com/

Re: What Happens When You ACH a Dead Person?

#35

Post by mixmastamyk »

lettergram wrote: post #19
grecy wrote: post #15

Earlier quoted context omitted.

Moving from Australia to Canada/US felt like going back in time 20 years when it came to banking. Even ten years ago in Australia I could do more with my online banking than I can today in North America. Checks are for what now?

I use checks all the time actually. Every other form of payment online is “pull”, I only want to “push” my funds to external people.

Nope, "online push" is ubiquitous in civilized countries.

Don't get me started on filing taxes!

Re: What Happens When You ACH a Dead Person?

#36

Post by saarons »

jedberg wrote: post #23
itcrowd wrote: post #12

This reminds me of a question I've had for the longest time (+): why is it that in the US wiring money between accounts is so expensive or difficult? Whole ecosystems of companies have sprung up (PayPal and Stripe come to mind, and apps such as TransferWise) to reduce the friction when the banks could easily set up a way cheaper system that would actually be better (privacy etc.) for the consumer. The EU seems to be…

The short answer is "because they can". The longer answer is because banking in the US is not as sophisticated as Europe since we have many fewer banks. The few banks we have have decided it isn't worth trying to compete on convince, so they haven't bothered to update the technology to be synchronous instead of asynchronous. In Europe, there are many banks in many countries, so they had to standardize quicker. FWIW i…

"because they can" is probably the best answer. Before RTP, which is still rolling out, wire tranfers were the only way to do same-day, non-reversible, high-value payments. On occasion we also see that wire transfers being sent manually need what's called "repair", as in the sending party didn't put enough information in the wire so the sending bank or receiving bank have to go get a human being to figure out what went wrong. Repairs and rejects add to the operational complexity of wire transfers and probably contribute to the higher end-user cost of sending one.

Re: What Happens When You ACH a Dead Person?

#37

Post by itcrowd »

saarons wrote: post #29
itcrowd wrote: post #12

This reminds me of a question I've had for the longest time (+): why is it that in the US wiring money between accounts is so expensive or difficult? Whole ecosystems of companies have sprung up (PayPal and Stripe come to mind, and apps such as TransferWise) to reduce the friction when the banks could easily set up a way cheaper system that would actually be better (privacy etc.) for the consumer. The EU seems to be…

CTO of Modern Treasury here. Banks are actually starting to setup a new payment system between themselves called Real-Time Payments (RTP) which has a lot of the same benefits as wire transfers. RTP is 24/7, instant, and (from our experience) much cheaper than wire transfers. It's starting to roll-out across more banks and currently ~50% of bank accounts can receive RTP transfers [1]. I just cashed out on Venmo the ot…

Thank you for the RTP information! Had not heard of it yet. The fees look very reasonable ($0.01-$0.045 depending on type of transaction) and they provide a level playing field (flat-fee, no discounts for volume)

I also heard someone say at some point that Americans are very wary of having people transfer money to their bank account. Not sure what the rationale is (maybe taxes or afraid of criminal money?) but I was wondering if you have heard this and if so, whether RTP has some protections or safeguards against this?

Re: What Happens When You ACH a Dead Person?

#38

Post by mindslight »

itcrowd wrote: post #12

This reminds me of a question I've had for the longest time (+): why is it that in the US wiring money between accounts is so expensive or difficult? Whole ecosystems of companies have sprung up (PayPal and Stripe come to mind, and apps such as TransferWise) to reduce the friction when the banks could easily set up a way cheaper system that would actually be better (privacy etc.) for the consumer. The EU seems to be…

ACH transfers aren't expensive or difficult, they're just relatively slow. The US banking system revolves around reversible transactions and pull transfers (check writing). If some business wants to buck the trend by taking in money via a pull and send it out via push, they're doubly on the hook for fraud.

Which is why services like Zelle have a bunch of things in their terms to make you more responsible for fraudulent transactions - so they're in a better position of not having to roll back as many. For that same reason, I think it's a terrible idea to sign up for things like Zelle with any account that handles more than petty cash

https://news.ycombinator.com/item?id=16899944

https://news.ycombinator.com/item?id=16033455

Re: What Happens When You ACH a Dead Person?

#39

Post by snoman »

ergothus wrote: post #16

Perhaps those well-versed in such arts can inform me, who knows little about ACH and the rest: Why is it so slow? I get that this is a system that can work built on top of any number of manual processes, but check-cashing scams are rampant and function in world where a major bank gets a check (apparently) from a different major bank and the customer is told it is all good....and possibly weeks later the check is note…

ACH is a file format. You generate an ACH file and then SFTP that to the Federal Bank (or another central bank... I forget which). In simple terms, the file contains a header and a bunch of batches. The header has the account info whomever generated the ACH file (a bank, usually) and the records in each batch the account info of another party.

The federal bank iterates through all of the records in the file and attempts to perform each transaction using the pair of account info, the type of transaction, and the details in the transaction record.

To answer the question about why it takes so long?

Generally it doesn't actually. Most companies will tell you it takes 24hrs to send you money, and that's because most companies generate and submit an ACH file once a day, and the federal bank will process those files at some point after that.

Why does it take weeks for a deposit to be marked invalid and reversed? Well, analytics, fraud detection, and those kinds of activities are not all real-time. More than you think are actually caught _remarkably_ fast, but many take time to find and often include collaboration with multiple banks, government agencies, and policing organizations from multiple countries. That means geo-political concerns, international treaties, timezones, communication problems. You name it.

Re: What Happens When You ACH a Dead Person?

#40

Post by edubs25 »

saarons wrote: post #29
itcrowd wrote: post #12

This reminds me of a question I've had for the longest time (+): why is it that in the US wiring money between accounts is so expensive or difficult? Whole ecosystems of companies have sprung up (PayPal and Stripe come to mind, and apps such as TransferWise) to reduce the friction when the banks could easily set up a way cheaper system that would actually be better (privacy etc.) for the consumer. The EU seems to be…

CTO of Modern Treasury here. Banks are actually starting to setup a new payment system between themselves called Real-Time Payments (RTP) which has a lot of the same benefits as wire transfers. RTP is 24/7, instant, and (from our experience) much cheaper than wire transfers. It's starting to roll-out across more banks and currently ~50% of bank accounts can receive RTP transfers [1]. I just cashed out on Venmo the ot…

Sad part that I've seen... worked on an implementation of Visa push payments at a TPA/ISO (I think it was formally called something else by Visa [Visa Direct?]) - it was designed as a real time payment system to make small payments to vendors or contractors. In order to settle everything at the end of the day, we were using ACH and wires behind the scenes to re-balance the source accounts. It was really comical IMO . I know progress has to start somewhere but it just felt like we were adding layers of complexity.
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