When I make a payment to someone via say a banking app on my mobile, they can be spending it virtually within seconds. That's from one bank to another.
I knew that transfers happened pretty quickly here but I paid someone for some work and they were spending it within say five minutes. They were unable to use their card beforehand because I had to come out earlier on the same day to buy some materials on their behalf.
In US a person can actually write a check for any amount, and you can photograph it with the bank app on your phone and be able to spend it instantly. I'm not saying it's an elegant system, but at least instant free payments exist.
What the hell is a check! I am, of course, joking: I'm 47 and probably still have a cheque book ... somewhere. I think I last wrote one about five or six years ago and before that a year or two.
You are probably acutely aware how ridiculous a solution to the delay in check clearance is, that involves taking photographs of it. That's something like a 10MB data transfer to convey say 1Kb of information. Those numbers are plucked from the air but probably of the right magnitude.
You'll be telling me next that in the US a written signature is still a thing 8) OK - I have stopped giggling from being offered a terminal to sign to approve purchases via my debit card when in the US: I haven't signed the back of one in about 20 years.
I never sign mine (I'm in the US) and have only rarely had it checked . I can count on one hand the number of times I've been asked to provide ID when using an unsigned card, and I've never been refused a purchase due to missing signature.
It might have changed in the 4 years I've been away from the states, but there is a simple answer on Why you haven't had it checked: In general, customers rarely hand their cards over to a store clerk.
The pharmacy I worked at had self-service machines. Customers signed the machine, and we never took the card. We were instructed not to do so unless the system prompted us to check. From what I could observe, there usually isn't reason to do so since the card companies only want proof if they are investigating a fraudulent purchase. I've personally had to go through paper signed slips (before a digital signature system) to prove the person signed. Otherwise, they just get stored for many years.
And honestly, it is a pretty bad security feature as there is no way I can tell if the signatures correctly match the person. Most signatures are illegible anyway and become even more so when it is digital. My own signature looks different in the two mediums. And this ignores the fact that signatures vary or that I was dealing with possibly sick people, who sometimes had their family member sign their name for them (especially for prescriptions) - and all the other variation that can make things not match.
The main exception to this rule is when folks purchased gift cards of different sorts. Even then, the signature wasn't a concern as we were making sure the card number was the same as the magnetic stripe.
No you can't. Most U.S. banks require a 1-2 day hold on mobile deposits still. Some banks, like USAA, credit you immediately, but most major banks and local CUs don't.
Hell, one of my credit unions holds payments I make to my credit card from my credit union checking account.
One credit union will give me a "courtesy credit" for photo-deposited checks up to $1,500. Another holds all of them for three business days.
The bank I was using to receive a wire transfer sat on the deposit until 6pm even though the sending bank said it was transmitted at 8:30am (same time zone).
How we handle moving money is nuts. Most of the time, the way that's actually the fastest is to go to a credit union ATM, withdraw the desired amount with one plastic card, and use the destination credit union's plastic card to deposit the exact same money back into the exact same ATM.
Schwab seems to clear my mobile deposits up to $10,000 per day within about 30 minutes of snapping the picture. If you deposit over $10,000 god help you.
I didn't mean to say every bank supports this. If USAA is the only one that credits any amount instantly, that's a shame, since they've started restricting who can sign up.
There is absolutely no instant spending of money deposited by check in the US. Checks have to clear, in some situations there can be a 1-5 hold for the entire amount, and the money can be returned within 30 days. Most banks will make a very small amount available for instant spend, in the $100-500 range. So I would say we're very far from instant free payment, don't you think?
I live in US and have a USAA bank account which allows this. They do not wait for the check to clear, even if it's tens of thousands of dollars. Obviously they reserve the right to bring your account into negative balance if the check fails to clear and you have spent it all. I guess it's akin to a line of credit?
