why? don't we already have Zelle and Venmo that does just that?
edit oops wrong article - Venmo is only “instant” requiring behind the scenes smoke and mirrors and also requires carrying balances
FedNow Is Live
31–40 of 1001 posts
Re: FedNow Is Live
#32I'm glad the US is finally catching up the rest of the world...India already has the Unified Payments Interface (UPI) [0]. Additionally, I think fears of this turning into a CBDC are overblown. Banks already have to settle transactions between banks through reserve transfers via the Fed...this will just help automate that process so we can send money from bank account to bank account. Like a Zelle or Venmo, but gover…
India’s system is more usable, though, apparently. This seems like an improvement but it doesn’t do the same thing? > Because UPI is designed to be intermediated by computers rather than by humans, transactional information gets captured by the payments company while the transaction is in progress, and that can tell the clerk (or cron job) that the payment succeeded without them needing access to the bank account. >…
Reward schemes are funded by interchange fees funded by higher product prices. They are a tax on the entire economy. Merchants can push the CC fees to customers who opt to pay with CCs vs cheap or free instant payment systems. T-Mobile has dropped autopay discounts if you use a credit card vs deposit/bank accounts for payment, for example. Walmart wrote public comments on this topic supporting the FedNow implementation.
Reward systems won’t last as merchants push towards FedNow as a payment alternative and charge you to use a credit card. Nor should they last.
https://news.ycombinator.com/item?id=36012866
> Walmart has observed a severe misalignment of incentives that has plagued the payments system in the United States for decades. Certain incumbents and large participants enjoy massive profits by stifling innovation in payments, ensuring that account access is limited to a small number of networks, and perpetuating barriers to entry for alternative solutions. Controlling this access allows the dominant players to extract rents from other payments system participants, ultimately resulting in higher costs for all consumers, particularly consumers who are unbanked or underbanked.
Re: FedNow Is Live
#33Earlier quoted context omitted.
It's bad enough that banks have virtually unlimited insight into my spending habits that we need to give the Feds the same access. I should have the right to buy a big mac without some government server getting pinged.
How will they protect us though unless they know the nature of every transaction we participate in? Are you really responsible enough to take care of yourself? A CBDC would combine the best aspects of company scrips with those of wartime ration tickets! I think you should reconsider your stance.
I don't think the government is trying to protect drug dealers or tax evaders from themselves. You intentionally chose a weak argument to fight against.
Re: FedNow Is Live
#34Earlier quoted context omitted.
> Is this akin to government-backed Venmo, or something? Yes, exactly. But you have to keep in mind that this is a two-edged sword. On the one hand, it's going to be convenient and probably secure. On the other hand, it's going to let the government see every transaction you make, which for some people will be a very high price to pay.
> On the other hand, it's going to let the government see every transaction you make Can you go into more detail here on what you think will change from the status quo? Existing bank transfers are obviously not secret from the government on request. While the government doesn't have direct access to run search heuristics on the whole dataset they just delegate that to the banks' internal compliance team.
If the government wants to tax these transactions - and let's admit it, they do - they'll take it right off the top. Unlike with the banking system where different banks have different prices for wires - or even free under certain conditions - you can't "shop around" for a new government.
Further, if a government determines you are not an "acceptable" participant, they have the ability to stop transactions to/from you.
*Ability doesn't necessarily translate to authority - you can probably fight it - but the government's legal fees are paid by us so they're effectively unlimited.
Re: FedNow Is Live
#35Here we go. CBDCs are next, and also national Digital IDs. https://m.youtube.com/watch?v=uwRSzNTp2ko Real ID + needing it to browse anything on the Internet: https://community.qbix.com/t/the-coming-war-on-end-to-end-en... From what I see people on HN writing, by and large they downplay the risks of these as well as AI. Or alternately seem to suggest that CBDCs and national IDs are not coming, and that it’s a conspira…
I've already read this comment before, just written a different way. I promise you I'm not a robot, I just disagree.
Re: FedNow Is Live
#36Will banks be able to charge fees to their customers for using FedNow like wire transfers?
They could theoretically, but it is unlikely due to each transaction costing a few cents and the monthly FedNow fee being $25 (it is a utility run on a cost recovery basis). No banks charge for Zelle payments to my knowledge, for example. This eventually replaces checks, money orders, Zelle, Venmo, ACH, and probably credit card payment volume over time (as seen with UPI in India and PIX in Brazil). Every deposit acco…
Given how generous credit card rewards are in the US, combined with the interest rates that get charged to people who buy things they can't afford, I don't see it replacing credit cards.
Re: FedNow Is Live
#37Earlier quoted context omitted.
Another concern I have heard voiced is that CBCD could be programmed - eg. you can't buy X, or you can only buy Y at certain times, or for certain prices, etc. and has the potential for reduced liberty vs. cash.
It can also be programmed with an expiration date to encourage you to spend it to stimulate the economy instead of saving it.
It could also be geofenced. Can't use your phone to buy fireworks from out of state because it's illegal in your state. Or you can only spend this money at a local store, but not at a store in another town.
Re: FedNow Is Live
#38Earlier quoted context omitted.
What is it about CBDCs you find concerning compared to cash?
For one, unlike cash, the issuing entity can program CBDC to expire on a specific date unless utilized. Another horror use case is that they could track and limit how many hamburgers or pizzas you eat daily, weekly, monthly or yearly!
Why would the government program money to expire? Would the money not become effectively worthless the closer to the expiration date? Why would a business accept transactions from people with money that’s about to expire would that then mean they would be giving away goods and services for free potentially?
Re: FedNow Is Live
#39Earlier quoted context omitted.
>replace cash That is the most important concern. Not even crypto can beat cash for convenience and anonymity. But having a way to transfer money outside of large corporations and instead through a government regulated service is a good thing.
It makes me question why we allow government to be in charge of our money, and the price of money (interest rate meddling by govt contractor federalreserve). I suppose we grow up with it and don't question it.
The Federal Reserve sets the interest rate that it loans money at. You are free to loan money to anyone at a lower rate if you wish.
Re: FedNow Is Live
#40My concern is that this is a trial run for an official CBDC that will eventually replace cash.
this is what it is.