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Comment by Liftyee | Hacker News Reader

I always have to remind myself of the bank transfer situation in the US whenever I read an article complaining about it. Here in the UK, bank transfers are quick and simple (the money appears to move virtually instantly). Feel free to enlighten me to why they're so slow in the US.

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"Community banks mostly don’t have programmers on staff, and are reliant on the so-called “core processors” ...

This is the largest reason why in-place upgrades to the U.S. financial system are slow. Coordinating the Faster ACH rollout took years, and the community bank lobby was loudly in favor of delaying it, to avoid disadvantaging themselves competitively versus banks with more capability to write software (and otherwise adapt operationally to the challenges same-day ACH posed)."

From the great blog Bits About Money: https://www.bitsaboutmoney.com/archive/community-banking-and...

UK Banks use FiServ too. So that can't be the only reason.

For ACH, it's the scheduling and batching that makes it slow. The transfer itself should be instant but often my bank sends it out around midnight. This is why Venmo and Zelle are so popular. You can also modify/cancel a bank transfer before it goes through, which is nice.

This is the same in Switzerland. If you request an IBAN transfer, it's never instant. The solution there for fast payments is called TWINT, which works at almost POS terminal (you take a picture of the displayed QR code).

I think BACS is similarly "slow" due to the settlement process.

People are almost always talking about Faster Payments [0] rather than BACS. It really is instant.

[0] https://en.m.wikipedia.org/wiki/Faster_Payment_System_(Unite...

I was pleasantly surprised when I bought a house that I could just transfer everything instantly with faster payments. I was fully expecting to deal with CHAPS, etc.

But the faster payments ceiling is large enough that buying a house falls under the limit.

Yeah Faster Payments is great, though it's relatively new in the scheme of banking and was explicitly designed to speed up small transfers (though now up to 1M I think?). My point was that the legacy system here is comparable to other countries. And until very recently a lot of companies still used BACS because that's how their payroll was set up.

I definitely miss it in other places I've worked.

These days ACH settlement runs multiple times a day. The biggest source of delay for ACH transfers is your bank delaying release of the funds for risk management. ACH transfers can be reversed even after they have "settled" and if the receiving bank has already disbursed the funds then they have to eat the cost of reimbursing the sender. Reversals are more likely to happen soon after the transfer completes, so delaying release of the funds makes it less likely the bank will be left holding the bag.

> If you request an IBAN transfer, it's never instant.

"In 2024, EU adopted Instant Payment Regulation, aiming to accelerate instant payments in Europe. For EU member states operating in euro it partially took affect in January 2025, for non-euro member states it will partially take affect in January 2027. This regulation includes requirements to send and receive transfers within 10 seconds, as well as to implement the Verification of Payee service."

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

The US actually has two real-time payment systems: RTP and FedNow. The number of participating banks is growing rapidly.

https://real-timepayments.com/Banks-Real-Time-Payments.html

Prior to that, you could get instant transfers but it came with a small fee because they were routed through credit card networks. The credit card networks took a fee but credit card transactions also have different guarantees and reversibility (e.g. costing the bank more in cases of fraud)

From the linked RTP site: "Because of development and operational costs most banks and credit unions will offer "send only" capabilities"

Which means nobody can send me money.

FedNow on the backend is supported by fewer banks than Zelle is, which is probably why hardly any banks expose a front-end for it.

I am convinced that this is in some cases a pro-consumer behavior. A credit card company once pulled money from my bank via ACH due to the automatic payment feature I set up, but that bank account didn't have enough money in it. The bank sent me at least two emails about the situation. I finally noticed that second email and wired myself more money from a different account. The credit card company didn't notice anything wrong and didn't charge any late fees or payment returned fees. The bank didn't charge any overdraft fees or insufficient funds fees. And the wire transfer didn't have a fee due to account balance. (Needless to say, from then on I no longer juggle multiple bank accounts like that.)

The bank had an opportunity to notify me precisely because ACH is not real time. And I had an opportunity to fix it because wire transfers is almost real time (finishes in minutes not days). I appreciate it when companies pull money from my account I get days of notice but if I need to move money quickly I can do it too.

In most cases it's definitely better for it to be fast. For example I sold a buggy face to face today and they paid me by bank transfer, and the reason we could do that was that I had a high confidence it would turn up quickly and they weren't trying to scam me. It actually took around 1 second which is really quite fast.

You don't need slow transfers to get an opportunity to satisfy automatic payments. I don't know how it works but in the UK direct debits (an automatic "take money from my account for bills" system) gives the bank a couple of days notice so my banking app warns me if I don't have enough money. Bank transfers are still instant.

Here in Switzerland bank transfers only take place during business hours

I believe this is because Ürs has to load my silver pieces onto the donkey and drive it to the other bank.

We're pretty lucky here in Australia. Over the past decade or so, PayID has been successfully rolled out to virtually all banks, giving us free and (usually) instant money transfers - I'd say more than half of all personal payments are now done with PayID. Old-skool bank transfers are still the norm for business and administrative payments, but that's changing too, and in any case, those transfers are increasingly being executed behind the scenes over Osko (aka PayID), so they end up settling in seconds (or at least hours) instead of days.

IS IT NOW!? last time I visited (long time ago) it was BACS, and the bank clerk told me it takes one day to "properly" register they've received my fund, one day to make sure it transferred and on the third and final day, the other bank can "properly" acknowledge they've received the fund thus why it took 3 FRIGGIN DAYS. I used so much cash back then.

patio11 wrote a bit about that here: https://www.bitsaboutmoney.com/archive/the-long-shadow-of-ch...

Isn't there a law in the UK which says it must be fast?

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