Hacker News Reader

Comment by debt | Hacker News Reader

What's a "reference"? You can enter arbitrary info during a transaction?

Genuinely curious. Is this a UK thing or available everywhere?

"Reference", "memo", "note" - some referrer or reminder about the transaction in question. Invoice number, PO number, 'movie tickets' ... it's just a free-form text field.

In the Netherlands, for at least the last 35 years, transaction forms have a field "Description" where you can enter arbitrary text. Originally on paper, now electronically.

Is that in any way remarkable?!

In the US, you pay $16 to send a wire and $16 to receive a wire. So, wires are not as common as in Europe.

On the other hand, ordering your bank to print a paper check, and send it through postal mail is free of charge.

>In the US, you pay $16 to send a wire and $16 to receive a wire. So, wires are not as common as in Europe.

If we're talking about SWIFT transfers, it's probably the same in Europe. The only difference is that in Europe there's SEPA, which is readily accessible by consumers, fast and cheap.

In the Eurozone, banks are prohibited to ask money for Euro-denominated transactions. They're also mostly instantaneous.

I don't do many though, other payment options are easier (e.g. authorize companies to just take recurring payments from my account).

They are not prohibited (I pay for them on my business account). They just need to price domestic transactions the same as EU-internal ones – which often results in free transfers.

$16 to pay someone? How do you do something like transfer your friend some money? Or pay someone who did some work for you?

Here in New Zealand you'd tend to get their bank account number and send them a (free) direct deposit through your bank's Internet banking service. Until very recently that was also the main payment method for our eBay auction site equivalent TradeMe (they've now started a sort of PayPal clone called Ping so that they can skim a little extra from each auction).

But I've heard people can potentially withdraw money from your account if they have your account number in the US?

>How do you do something like transfer your friend some money? Or pay someone who did some work for you?

Venmo mostly.

Interesting. But the service provider takes a cut that way, right?

NZ expat here :) Venmo doesn't charge for sending or receiving money like this to or from people. They make money through other means; from the top of my head one is paying by credit card - they take 3% if you use credit card. Another way they make money (1% per transfer) is by doing an "instant transfer" directly from your Venmo account to your bank (the other option is ACH transfer which is usually next-day delivery.) I tried this on a Sunday night which was also part of a long weekend and the money instantly appeared in my US bank account and I got a push notification from my bank that a deposit was just made. It was awesome and makes NZ look out of date.

Venmo is amazing. It's so fast and practically everyone has it. It's the Google of payments. I wish New Zealand had something like that. Sending money to friends in NZ is slow and painful - not terribly so, but compared to Venmo they really are.

in practice, no one uses the banks directly to send money like that: we use apps like Venmo / CashApp that take your debit card/bank info and act as an intermediary for sending/receiving money.

A lot of US based startups make a lot more sense to us Europeans in case we move to the US and notice how broken all infrastructure is.

Banking still uses cheques, so you have Paypal, Venmo, CashApp and so on.

Public transport is bad or even non existent which is why Uber and Lift exist.

The programm of over-the-air TV sucks and you get Netflix, HBO, Hulu and so on.

Over the air has the newest stuff. Streaming is for yesterday's hit.

Uber exists because taxis suck.

Cheques are safer and more portable than give me your bank account because you choose where to deposit.

Paypal is for websites no stores accept it and doesn't replace a cheque

> Cheques are safer and more portable than give me your bank account because you choose where to deposit.

Maybe it's different in the US, but I have a different account number for each of my bank accounts. So I can still choose where I want to deposit someone's money when I give them my account number, by choosing which account number I give to them. And no-one has to go to a bank.

That's true you can give out different account numbers. You can't change that once you give it out though a cheque allows you to decide at the very last moment.

Is it really that hard to receive the money then transfer it to the right account?

Yes, it's an extra step, but you're already doing way more steps to cash a cheque than use a transfer service where you only give an account number and suddenly the money is there.

IMO, this sounds like a solution looking for a problem to me.

For my housekeeper, service people, etc. usually write a physical check. For friends and so forth mostly the same but sometimes Apple Pay, PayPal...

Wire transfers also take 2-3 days to clear because the Fed likes to sit on the float. They totally suck in the US.

This is one of the reasons Paypay got so big so fast. There was a huge pent up demand for a wire transfer service that didn't suck. But then Paypal started to suck and people had to find something new.

>In the US, you pay $16 to send a wire and $16 to receive a wire.

This isn't true, each bank sets their own fees. It's true it's usually stupid expensive to send one, but none of my main banks charge to receive a wire.

I don't think any (major, credible) bank charges to receive a wire because like text messages, you have no control on getting wire transfers, and it would likely cost more to set up such a system than to just accept wires from anyone to any account.

With SEPA, they now have both the free-style "description" box, as well as a (shorter) "Reference" field that has a standardised format including parity bits to prevent typos and the trouble they can cause.

American banking infrastructure is weirdly antiquated.

For a long time I was confused by Americans raving about things like venmo or bitcoin talking about it making it cheap and easy to transfer money. Then I learnt more about the US banking system and it all made a lot more sense.

Planet Money did an episode all about it, featuring someone from the UK talking about our Faster Payments system, who is basically instant.

At the very least with european SEPA transfers and their predecessors, but I would have assumed pretty much all bank transfers where you send money support some way to put a message - how else would you map incoming transactions from previously unknown senders to what they're for?

In the US, AFAIK the only metadata you get with a direct / ACH deposit is the sender's "name", usually the company name. I assume that you can't easily change this per transaction.

US banking infrastructure is decades behind the rest of the world in many areas.

You can include a memo on a paper check though.

I wonder if you could write a personal check and deposit it to the person's bank account -- write something in the "memo" line and hope that the person checks the scanned images of the cancelled checks. Of course, then that person would also have your bank account number.

So if you were paying an invoice, is there no way to add the invoice number/reference to the transaction? Do people pay everything with cheques?

For regular bills, when adding a bill pay account online, the bank will ask for your account number... so there must be some way to specify that with an ACH transaction. I've noticed that the custom input memo field visible to the end user goes away on ACH transactions though, at least at my bank. Perhaps it's just used by the account number automatically?

For bills that don't accept ACH bill pay (i.e. most smaller companies and utilities), banks will often print and mail payments via check for free (it just says "signature on file" on the printed check). Like I said, decades behind.

Wow, that is bonkers.

I pay our childminder by bank transfer. Its almost instant to do from my phone, free, and I just put the invoice number in the reference field. The idea that banks would print and post cheques is like something from the era of telegrams. So weirdly anachronistic.

It is probably even more decades than you expect.

The predecessor to this UK system was introduced in 1968.

(Usage by individuals to send money didn't really happen until online banking was introduced around 2000.)

https://en.wikipedia.org/wiki/BACS

Yep. While Faster Payments is brilliant, BACS' overnight processing and the direct debit system is total sufficient for the vast majority of cases, certainly things like bill payments.

It does seem crazy, take this for example:

https://www.usbank.com/online-mobile-banking/transfer-money....

This says I have to pay a fee, and then wait 2-3 days to send somebody money. That's not caused by "infrastructure" that's caused by greed in the absence of effective government to tell them to get their shit together.

Even better it tells me the size of that fee is included in a "Fee Guide" the link for which is a 404. Excellent work.

It's always been a thing in the countries I've banked at: Fiji, New Zealand, Australia.

If you're a European teenager transfering money to someone you know, it's customary to enter something like "Payment for the drugs and the firearms".

Same with Venmo in the US. There is literally a whole website that polls the front-page API for Venmo, scans for some keywords that could indicate a "spicy" transaction description, and displays them.[0]

P.S. I have zero affiliation with the website or the owners/developers, I just thought it was entertaining.

0. http://www.vicemo.com/

Why are these all public?

because venmo wants to be a bit of a "social network" somehow

e.g.

https://www.youtube.com/watch?v=BWFLztKBrLY

You decide if you want the transaction to be public when you make the transaction.

You have to be careful with "naughty" words, like if your description includes the name of a company on the Dept of Treasury's shitlist[1]

Some of them are fairly generic terms. I remember when this was posted[2] on HN (payment troubles caused by writing "Blue Sky" on the memo field in a check, because a company called "Blue Sky Industries" was caught doing business with Iran).

Supposedly Venmo will also flag your payment if you put "ISIS" or something like that in the description

[1]: https://www.treasury.gov/ofac/downloads/sdnlist.txt

[2]: http://anildash.com/2014/02/21/here_is_a_thing_that_happened...

I would be concerned about soundex matches too.

When you pay someone, how do you let them know what it's for without adding a customer number, or a note saying 'thanks for dinner' or something? That's a reference.

You can in the US. Just turn the check over and write on the other side :-)

Reply on news.ycombinator.com