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Comment by guan | Hacker News Reader

A lot of services verify by making those two random <$1 deposits and having customers enter the amounts in, then withdrawing them immediately. This appears to be faster than the verification system.

The first business I encountered that used the “real” verification system was Fidelity, and I found that quite annoying.

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Banks frustrate me, and I don't think there is any technological excuse. I suspect the systems are antiquated and they are not motivated to change. They use security as a cover for their slowness.

In the US, banks are all owners of the Automated Clearing House, and every time a vote comes up to modernize it, they don't get a majority vote because they sell products to "move" money faster at a much higher premium:

http://www.npr.org/blogs/money/2013/10/04/229224964/episode-...

I think security, and maybe more so stability are very valid reasons for banks to move slowly on these systems.

It may appear archaic from the outside, but these systems are pushing $39 trillion dollars a year (22 billion transactions) [1]. I can see why the big banks are hesitant to change things drastically.

[1] https://www.nacha.org/ach-network/timeline

Security would be a good reason to be slow, but I suspect that isn't the reason.

Banks are conservative, too. Which is generally good, but that in itself is part of the reason why the process is slow, in addition to genuine concerns about security and reliability.

In some ways security isn’t such a big deal for financial transactions, because they can be undone. Checks are very insecure. ACH is insecure because you can take money out of anyone’s account with the information at the bottom of the check, but ACH transactions can be reversed for at least 45 days after they are made.

You also have to ask “how much?” How long is it reasonable to wait for change? The system for same day ACH has existed for years. Very few banks have opted in. Should the Fed set a deadline and say, everyone has to be on it by 2020? (It’s the nature of such deadlines that they are be extended, but something will eventually happen.)

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