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The EU now requires 15'000€ transfers in under 2 minutes and less than 1,50€ fees, and any other transfers in under 24 hours for free (for non-commercial customers).

What do they mean by "transfer"? I can transfer money to a friend for lunch instantly already, using a plethora of apps such as PayPal, Cash, Venmo, etc.

Or, if I write a check, and they deposit it on their bank's phone app, nearly always the funds are available immediately.

$15,000 Euros is a lot of money... I honestly wonder what problem was solved by mandating that amount of money must be transferred, cleared, and available for withdrawal within 2 minutes. It seems to me nobody has a legitimate reason for that, unless you're a Nigerian Prince.

What problem did it solve and why is it considered a good thing?

€15000 (we have a whole symbol for the Euro) isn't that much money. You definitely might buy a second hand car for that much, and I don't want to give you the keys until the money appears in my account, even if legally you'd have "stolen" it if your money wasn't good, that's a huge hassle.

And I've certainly sent somewhat smaller amounts for stuff like "Hey trip is on, we booked that holiday villa, €1000 for single rooms, €800 each if you're sharing, let me know if you can't pay this week".

I'm sure this rule would have been fine if it was €10 000 rather than €15 000 but how often do you want politicians to re-authorise? If it was €1000 by now people would be annoyed at the size limit already.

> €15000 (we have a whole symbol for the Euro)

I don't have one on my keyboard unfortunately, otherwise I'd happily use it where appropriate!

> And I've certainly sent somewhat smaller amounts for stuff like "Hey trip is on, we booked that holiday villa, €1000 for single rooms, €800 each if you're sharing, let me know if you can't pay this week".

Your scenario doesn't seem to have been impacted by 2 minute mandatory transfer times in either direction.

> I'm sure this rule would have been fine if it was €10 000 rather than €15 000 but how often do you want politicians to re-authorise? If it was €1000 by now people would be annoyed at the size limit already.

Sure it's an arbitrary amount and they had to pick some amount I suppose. Even $10K is a lot for an ordinary person - potentially life changing if lost in some unfortunate instant transfer with the wrong number entered. That, of course, is a human problem (typing wrong number or whatever), but the delays we're talking about provide a safety cushion to cancel transactions in those scenarios.

Deliberately fooling people into giving the wrong account numbers for transactions they wanted to make, but to somebody else ("Push Fraud") was a thing in the UK. So, they told the banks to make the previously merely reference value for the recipient's name actually enforced.

If I try to give money to Victoria Smith 12-34-56 0123456789 then the backend will notice that's not Victoria Smith's account, and tell me I need to figure out what I did wrong. Maybe the problem is Victoria married, and is now Victoria Jones, you can clear that up. Maybe I got the number wrong. Maybe she's Victoria Smyth or Smithe and then it'll suggest this was just a typo using some heuristic. Or maybe it's the account of a scammer named Michael Black and the scam fails because the name doesn't match.

This was a bit awkward for my ISP because their name has an ampersand in it, and so of course this means some banks end up believing their name is "Andrews &AMP; Arnold" and similar stupidity. But it's been bedded down now a bit.

This approach leverages a reference for the payee that existed but was previously not checked, plus KYC checks already in place, it's hard these days to open accounts for names that aren't yours or with no apparent credit history for an organisation.

(a) using third party apps instead of the banking system itself is a workaround, not a solution. especially as those apps demand fees.

(b) cheques have been deprecated and stopped being accepted in the EU in 2004.

It solves the same issue as paypal, cash, venmo, etc, except the receiver can immediately use the money for any and all purposes, without fees, without yet another third party app.

This in turn allows new third party apps to be built on top of the new infrastructure.

Can I ask where this <2 minutes comes from? As various banks I work with don't follow that.

I get a few transfers in the EU per month and sometimes I am lucky if it is same day (if done in the morning) but in most cases I get it the next day.

Heck, in same country, I have two bank accounts and transfer between them have never been faster than 4-6 hours. (Same bank is seconds though)

That's the SEPA instant spec which is slowly being rolled out and will become mandatory to support in the future.

If your bank doesn't support it yet, the old 24h limit applies.

> I've just never heard of a scenario where someone needed $50k instantly sent anywhere for anything.

maybe not $50k, but "deposit paycheck on same day rent is due" is a fairly common problem that people have. the person has the money to pay rent, but it might not clear before their rent check bounces. there still exist landlords that only accept payment via check.

I agree in general. wires are fast enough for most truly large transfers of money, if only because the recipient is usually willing to be more flexible with such a large amount on the line.

It's been quite some time, but every landlord I had which required a check only required having the physical check in-hand by the 1st (or more commonly by the 5th if it was being mailed).

If you're bouncing rent checks because it took too long to clear, you have other issues and immediate withdrawal isn't going to save you anyway.

Besides, if you're cutting checks of the same amount every month, you can setup BillPay (free at most/all? banks) and let your bank handle writing/mailing the check on time.

> If you're bouncing rent checks because it took too long to clear, you have other issues and immediate withdrawal isn't going to save you anyway.

I'm talking about people who barely make enough money to cover their monthly expenses, so yeah that financial situation is hardly ideal. someone in this situation definitely does not want to set up autopay against their checking account.

it's a sort of death by a thousand cuts for people in this situation. you generally have to pay rent in advance (ie, you pay that month's rent on the first of the month). you get "paid" at the end of a two week period, but then it takes about a week for your employer to process payroll. if your employer doesn't do direct deposit, you now have a check in hand that takes about two days to clear. that two days isn't the bulk of the problem, but it can definitely be the straw that breaks the camel's back.

> but "deposit paycheck on same day rent is due" is a fairly common problem that people have. the person has the money to pay rent, but it might not clear before their rent check bounces. there still exist landlords that only accept payment via check.

Two things:

1. For paper checks, this has been addressed via Check21 which took effect at the end of 2004. It enforces funds availability for even for non-local checks and/or bank drafts.

2. Writing a check against an account that does not have available funds has all the characteristics of check kiting. Check kiting is illegal.

For non-checks ACH credits settle before ACH debits or any other debit transactions.

When you are sending with a credit card, you are not sending it anywhere near "instantly". The receiving end pays a 2-3% fee, and doesn't actually get access to the funds for anywhere from a few days to a month later. And even once they receive the money, it can be clawed back if it's fraudulent, was done with a stolen card, etc.