Instant bank transfers on the way

Reaper

Thought you might be interested to read this article. Apparently instant transfers between accounts will soon be here followed by speeded up cheque clearance.

I never did understand how the banks could justify taking 4 days to move money between head offices when a cashpoint machine on a high street can withdraw money from a different bank instantly. Happily the end is in sight.

dougk_2

And about time too.
One question though is what about all those "premium" accounts that give free CHAPS and other services... won't their benefits be erased?
I have never been happy using these "accounts" and paying a monthly fee for these "extra" services which they should have been giving to you anyway.

pin

Reaper wrote:

I never did understand how the banks could justify taking 4 days to move money between head offices when a cashpoint machine on a high street can withdraw money from a different bank instantly. Happily the end is in sight.

Very interesting.

To answer your question, I think the answer is the in the first line of the article: "THE practice of banks profiting by delaying money transfers and the clearing of cheques" : i.e. they are profiting

robnye

i wonder if the direct debit/standing order black hole will be filled as well.......


just read report..... dd's and so's to be dealt with first......

buses7675

Hi All,

I'm glad about this, as it is stupid the amount of time that money 'disapears' between accounts! Only current exception I know of is Egg Savings/Egg Pay accounts, which you can credit with a debit card, thus instant transfer!

For some accounts too, its quicker to withdraw cash at an ATM, then put it into another account directly, than transfter it online, which really is silly!

Cheers

Steve

Milarky

Direct debits are effectively 'same day' now, of course - it's just the request for payment which has to be submitted in advance. But this should mean that ING, for instance can collect money into their account on the day you request it - and also [more importantly] your bank account may be credited from ING on the day you request a withdrawal [at the moment there is a two loss of interest perion od withdrawals]

The major benefit we should feel is being able to make payments 'at the last moment' so as to meet due dates/dd withdrawals elsewhere - rather than having to remember how long to leave and paying up sooner!

Kazza242

Reaper wrote:

Thought you might be interested to read this article. Apparently instant transfers between accounts will soon be here followed by speeded up cheque clearance.

I never did understand how the banks could justify taking 4 days to move money between head offices when a cashpoint machine on a high street can withdraw money from a different bank instantly. Happily the end is in sight.

Yes, but won't the banks recoup the money they'll lose because of quicker transfers from somewhere else i.e. the customer? In terms of higher interest rates on loans, credit cards and mortgages.

Reaper

At least if they charge a higher interest rate it is out in the open, and the competition with other banks means the headline rates are always under pressure. That is far preferable to "stealth charges".

Besides the banks can easily absorb the cost if they choose to. HSBC made £9.6bn profit this year.

Milarky

This reminds me a bit - in reverse - of what BT [a bit off this topic, sorry!] have sneaked in quite recently. They have tweaked every call made so that they are now rounded up in durarion to the next second [as opposed to the previous whole second] AND the exact cost is THEN rounded up to the next 0.1 pence. Not much you might think - hardly worth doing.. But it's got to be worth at least 10million I estimate on the 'bottom line' That'll pay for a few staff junkets..

Reaper

In case anyone missed it the announcement has now been made. Despite years of warning it was going to happen the banks say they need lots of time to implement it.

So they are being given 6 months to come up with a plan, and a further 2 years to implement it.

That's a ludicrous amount of feet dragging, and that doesn't even include cheques which will follow at some point in the future. Article about it here.

Milarky

Yes, much over-hyped of what turned out to be a 'holding' announcement.

The real issue is interest. Few people rely on same day payments though if they were free we'd used them, naturally. The problem is in two areas:

1) You pay someone today but it takes 2 days + W/E + B/K to reach them. If it's their money they don't have to charge, after you send payment until it arrives. If they are a 'bank' then they CHOOSE to charge you because the money is 'in supsense' but you haven't got it, so the banks have.

2) You pay yourself [moving money between accounts] it's your money not the banks - you don't mind which account pays you interest during this time as long as ONE does. Lloyds has chosen to credit outgoing payments from the nominal 3 days to takes to reach the destination, therefore other banks could [technically] do this now, they are merely CHOOSING not to.

Given we have a 2 and a bit year delay before the hoped for improvements in transfer times them it is incumbent on us to ask the banks whether they intend to pay interest on payments in transit until that time..