Instant interbank payments

So. A mate paid for lunch using EFT. We use entirely different banks NAB and ING. Payment was received in less than a minute.

Awesome, isn’t it?

 

It perplexes me that bank transfers go out of any of my accounts but are only received by my other bank account 2-3 sometimes 5 days later. Where is my money in the intervening period? I expect they are in the overnight market markets for profits to bank shareholders.

 

It is awesome!

I have not set up PayID or whatever but I transferred my salary to my offset account last week then immediately logged into my offset account to check something to find my pay had already arrived. It was instant. Amazing!

 

They will have internet banking on computers soon

 

Or you can wave your phone in front of a terminal and it'll empty your wallet.

 

A lot of that goes way back to the legacy IT systems the banks (and many others) used.

Back in the day of big mainframes, all the transactions from Bank A to Bank B would be queued up into a 'file' by Bank A. At a certain point in the night, that file would be sent to Bank B.

Bank B would run a program to process that file and update their accounts with these transactions. If they receive the file from Bank A in time, it would be run that night as part of their processes, if not it would wait until the next evening.

There might have also been separate processes to move the data into or out of the the files being transferred. Hence a transaction would take at least overnight to reach its destination, sometimes even longer.

For the most part these IT systems have been upgraded (some of them dated back to the 80s, real time banking has only rolled out over the last 10 years or so), but some still do exist. Whilst many of these systems were ancient technology 20 years ago, they were reliable. This is an environment where reliability is far more important than anything else, including speed.

 

No they have had wives for centuries

 

The savings measure introduced in most countries is a limit of one per customer.

 

This should have changed ages ago. As soon as PayPal instant payments were introduced banks should have taken note. Reliability doesn’t equal extra time. A lot of rialble transactions are instant, including debit and credit card payments. Banks just had no incentive of giving same flexibility to customers.

 

Wow, and it didn't even require a bank of supercomputers in china brute-force computing algorithms on a string of code of arbitrary determined value...

 

But without the block chain it doesn’t feel right....

 

The reason it takes so long to upgrade these types of systems is because introducing a new system is a whole new architecture, millions of lines of code and a massive migration. This potentially introduces thousands of bugs which means customers could loose money. We scream when the ATMs don't work for a day, can you imagine what would happen if people's accounts simply disappeared?

PayPal had the advantage of being build from scratch on reasonably modern systems. It can be designed. Migrating from one architecture to another is an evolution which needs to cater to the old and the new at the same time. You can't simply build a new system and one day turn the switch on.

 

You will get fees and no service from all banks soon.

 

What wallet ? What Money.....it is all bits bytes now....total disconnect going on.......

And then when one part of a system does not work....you have a situation where store not only cannot take the fuzzy logic money, but they cant take cash either ! Fantastic, so advanced we are, we do not even need to count anymore.

 

I did a transfer from CBA to Westpac about 4 hours ago. Still waiting to see the money..
Westpac must be behind in technology.

 

You mean I won't have to line up with my cash book anymore?????? Lol

 

I went into ANZ today to ask about PayID and it seems they haven't got it up and running yet. I was told to give out my BSB and account number instead.
So I am considering opening an account with another bank.

 

But remember, it will still only work with banks that have it. No good opening an account with CBA (who has PayID) and sending funds to someone who has ANZ (no PayID), because it will still be just as slow.