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Comment by basisword | Hacker News Reader

I find it odd things like this, Venmo, Square cash even need to exist. There’s a reason none of them get used much (or even exist) outside the US. Just fix banking in the US and they problems they solve disappear. In the UK (and the EU I believe too) bank transfers and instant and free. Digital banks like Monzo make it even easier (through contact syncing, better UI). Third party apps need not get involved.

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In Canada you’ve been able to send money to people for 15 years just by knowing their email address. You also set a security question. I also had a debit card I could use in most stores almost 30 years ago.

I was shocked as a young adult when I could travel in the US and use my debit card to get money at almost any atm, yet Americans had to sometimes seek out the correct ATM, even in their country.

I was shocked again in Japan when I moved here ten years ago when online banking was useless, transfers took up to 3 days, and most of the bank’s atms closed at 5 or 6pm. Oddly enough I could always find some atm open 24 hours that worked with my Canadian debit card, even when I could not find an atm open that worked with my Japan Post bank debit card. Those problems are all solved now, but it’s no wonder that there are now 30+ competing digital payment systems in Japan vs just a few in Canada. You also have to still really go out of your way when choosing a bank to make sure that your debit card will work overseas.

The original Canadian system is called Interac, and it’s nice that everyone has been able to use it for 30+ Years. I’ve never heard of anyone being blacklisted due to an error, like you hear about with PayPal and the other things that have come since then.

The flip side in Canada is our wire system for large transfers. We rolled our own technology and it is a complete failure. I do wire transfers many times per year and I would say 1/3 of them end in “lost” payments that require multiple phone calls and a number of days for the investigations group to track down. And this is through no error on the sender or recipient side (as explained by the investigations teams). There have been a number of articles over the last few years on the topic and I feel awful for those involved who actually do make a legitimate mistake (transpose numbers of a branch number for example) and never see their money again.

When it works perfectly, the transaction is still nowhere near instant (transfers “cross” only at certain times of the day, almost as if it involves actual people driving between banks - ludicrous!) and recipient banks often do not recognize receipt for a day. And the fees are relatively absurd ($80-120 to send and to the same to receive) considering Interac money transfers are free.

I’ll note that literally everyone I deal with shares the same experiences with wires.

It is bizarre that the largest, likely most important, transactions we have a system that works objectively far worse with fewer checks and balances and more opportunity for error than the system we use for meaningless small transactions.

This is a really surprising comment to me. I also do many wire transfers and EFTs (used to run an investment company, so on the order of 200 incoming/outgoing EFTs and 4-5 wires per month) and have no idea what you are talking about. The only times I've had issues is either (1) when the banking information was entered incorrectly, either by a client or by my staff; (2) if it's a weird kind of trust account that doesn't accept direct wires and needs to go through an intermediary account, which is really rare.

I would really like to know what activity you are doing that is causing you so many payment processing issues.

Unless you are talking about LVTS which AFAIK is only used for inter-bank transfers? I have no experience with that system.

I’m not the OP, but anecdotally as an American who used to work for a Canadian company which handled cross-border payroll by wire from Canada, my experience was for the most part that our payroll person worked her ass off to get everything right each time and that it was quite a significant amount of work. The actual transfers would always settle on the date expected and as expected, but I was always missing $10. I took it as a professional expense (loss) on my taxes, and no one from my bank to TD (the firms bank) could tell me which intermediary was taking a fee. They had tried for years before I came along to get to the root cause of it. All the US based people had the same issue.

I moved to Canada from the US recently and was shocked at how poorly Interac e-transfers work and that there is no Venmo/Cash equivalent. The system seems to assume a 1:1 mapping from phone numbers or emails to bank accounts. Having multiple bank accounts means disabling and reconfiguring the autodeposit features constantly. I've also gotten used to friends not receiving transfers I send them, which was never a thing with Venmo/Cash -- you just check the history in the app.

ATMs are also mind-boggling after getting used to banks that will refund ATM fees in the US. In Canada it's back to the fee to use ATM + fee from the bank for using an ATM that I remember from 20 years ago in the US.

It is true that bank transfers are fast, instant most of the time these days. However, when people want to quickly send me money, they still usually ask for paypal, simply because it’s easier to tell someone a nickname or email address than my IBAN. not that this is an unsolvable issue, just sharing my experience from Germany.

Interesting. In the UK we just need to share account number and sort code. These are quite easy to remember in your head. IBAN would complicate things. Is IBAN always required or only for cross-border transfers?

An IBAN is just the sort code and account number, with a prefix, so would be just as easy to remember.

However, a sort code is always presented as 12-34-56 and the account number normally shown as 1234-5678 - so it's easily chunked and very easy to remember.

You also rarely need it among groups primarily using Monzo - which among my UK friend group is universal. Just pick from contacts, just like Apple Cash.

I've also found paying strangers on Monzo to be ridiculously easy, you both turn on bluetooth and go to "pay nearby" screen. You just ask them "Are you <full name>?" to verify, then send money.

While very true, I think the point is that if you come across someone not using Monzo as their bank it’s almost just as easy to send them money.

This varies by country, but e.g. in Finland IBANs completely replaced legacy numbers in 2010.

Mine is 5 characters longer than the legacy number was (added "FI", 2 check digits, 2 padding zeroes, removed dash), for a total of 18 characters.

You can use mobile phone numbers here too (though admittedly UK account numbers are easy enough most people just use those )

Some countries only use IBANs, without some other local account identifier.

In the Netherlands a similar app is popular called https://www.tikkie.me. Commercial banks have also implemented their own solutions for generating payment links though. See https://www.ing.nl/particulier/digitaal-bankieren/mobiel-ban....

Payment links are easier and quicker to use than manually entering details in your banking app.

In Estonia, you can link a phone number to your IBAN. When making payments, the sender just needs a phone number, and the corresponding IBAN is automatically looked up. (The lookup service is managed by the central bank, and used by all (major) banks.)

I don't think I've seen this, do you have a link to learn more?

It's apparently called “proxy payment”: https://www.lhv.ee/en/proxypayment

Same in Poland, thanks to BLIK payments. Works across all major banks. https://iko.pkobp.pl/iko_en/features/mobile-transfer/

There's a similar system in several country (Spain as well for example, called Bizum). It's a shame that it's not a Europe-wide system.

We have that here for Zelle, which is built-in to some banking apps, making it really easy for most people to achieve this. You can alternatively give them a name or email as well. Zelle is not perfect but I have used it often just because it is built-in to my banking. I just wish I could have multiple bank accounts hooked up to it properly, not sure how to sort that out.

The same exists in Spain (albeit with limits per month), it's called Bizum: https://bizum.es/en/about-us/

Among many reasons why exchanging an IBAN and submitting a SEPA transfer in the EU is so cumbersome is that there were at least two standards to encode those details in a QR code.

It seems that, by now, except Czech Republic & Slovakia [1], the EPC QR code [2] has won.

[1] https://en.wikipedia.org/wiki/Short_Payment_Descriptor [2] https://en.wikipedia.org/wiki/EPC_QR_code

In Spain we have this Bizum thing that allow us to use phone numbers to send money between bank accounts. I Brazil we have Pix which is similar but allows great flexibility on how to identify one person(phone, email, random key)

Canada has email money transfers that is done via the big banks.

In Australia we can use a phone number or email address to transfer money. It’s near instant transfer and even comes up with the full name of the person you’re sending money to.

Little cumbersome since I never bothered to get peoples phone numbers till recently.

My experience with Paypal is the opposite. On multiple occasions I've had someone send me money on Paypal, but then it gets held up in checks and verification for 2-4 weeks, during which time I cannot access it. Sometimes it is instant though. There seems to be no pattern to it. This lack of certainty discourages me from using Paypal to receive payments in the future as I now consider it as a risky, slow, last-resort option.

If the PayPal transfer was funded by a credit card they’ll often put a “hold” on it until it finally clears.

In argentina you can set an 'alias' for your account, if you don't you get one by default... I put my name as alias, I started getting payments from people I don't know o.O

If US we use Zelle, it's a for profit company owned by the large US banks. If your bank supports Zelle, you can send money instantly.

But, it’s not nearly as popular as Venmo. I’ve never been asked to send anyone money over Zelle, but Venmo is used often. Maybe it’s a regional thing (network effects are huge here), but just because something is supported by our banks doesn’t mean it gets used.

Also, I don’t necessarily want to login to my bank app to send money to someone to cover dinner. But a secondary app, like Venmo, is fine.

SF anecdotes:

My old house cleaner used Zelle, new one Venmo. I recently prepaid for a camping trip and needed 40 parents from kids’ school to pay me back. Most used Venmo, a few used Zelle, one sent to my wife’s PayPal. Most of my friends use Zelle (and close friends and family use Apple Cash because it has the least amount of friction, once set up).

My kid in preschool has an extra sports class and music class. Both are paid by Zelle. Last month I got a haircut and the owner had a sign saying she preferred Zelle (saves 2-3% vs Cc/Square). Zelle seems to be growing amongst small businesses.

I once sent a friend who works at Square some square cash. It went unredeemed because he forgot about it. Had to resend.

I’ve only used wires when buying homes.

I use ACH to pay taxes, some utilities, etc.

StateFarm lets me pay my insurance bill with ApplePay, which gives me 2% cash back.

In short, very Balkanized with no dominant system.

I've only ever used one bank that supports Zelle (and I'm departing that bank), and I've never once heard of anybody using it.

Yes the US does have Zelle technically, but it's not really a solution at least in the foreseeable future.

"Technically?" Curious how you've even managed to avoid it, frankly – all of the largest US banks have it: Bank of America, Chase, Citi, Capital One, and Wells Fargo, as well as 1,536 other banks.

Going down this list, I don't think I've ever used a bank that didn't have it: https://www.zellepay.com/get-started

Zelle always felt to me like the banks chasing down the already-escaped cattle.

If you wanted a no-security-promises send-money-to-your-friends system, you probably already had PayPal or CashApp or something else of the sort. As far as I can tell, it's a popular fit for people who were scraping PayPal's "seriously, your selling-stuff-on-Facebook thing is a business, pay business fees" detection a little too closely.

The timing also seemed odd, with the promises of FedNow being "real soon now" -- do they intend to eventually run Zelle atop it, or is it an attempt to build an installed base (and vendor lock in) before every bank in the country can say "Well, we're all on the same network, so transfers are immediate for everyone?"

Bank transfers are not instant in Norway at least. There is a popular peer to peer app called Vipps that handles all of the complexity for you. If somebody's at your door picking up the couch you sold online you can't wait for the bank transfer to go through.

I believe Monzo is becoming available in the US so this might help improve the situation there, at least for monzo-to-monzo transfers. However I guess the whole system needs improving to allow seamless inter-bank transfers without a middleman.

US FedNow instant payments go live next year.

Instant SEPA is still a bit of a luxury feature adopted mostly by fintechs, at least the sending side.

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