Comments on: America needs a modern payments architecture

By: zylstra

zylstra — Fri, 10 May 2013 07:37:49 +0000

I agree with TaxWonk here. Concerning your comment, “And we’re not going to get it”, you’re clueless.

By: y2kurtus

y2kurtus — Tue, 03 Apr 2012 01:54:53 +0000

@ RBA… in a 5% world a trillion in float would be worth something… in a 0% world it’s not worth the trouble.

@ Felix… debit transactions memo post in a matter of minutes at my small mutual bank. True the funds don’t move until the next business day but if you are a merchant knowing the money is comming in tomorrow as sure as the sun will rise is pretty much as good as actually having it.

It would be nice if I could text a neice or nephew $10 on their birthday. If I can text $10 to a desaster releif effort why can’t I do it to a relitive on the other coast?

By: RealBadAttitude

RealBadAttitude — Mon, 02 Apr 2012 03:55:34 +0000

“Felix, the supposed reason why “America desperately needs immediate funds transfer, or IFT.” is so that the banks don’t lose the “float” while that money is in transit, so your article by not pointing that fact out is quite disingenuous. The “float” from trillions of transactions amounts to a considerable amount of money the banks are losing every minute of every day. THAT is what their problem really is.”

Exactly.

By: egreen

egreen — Sun, 01 Apr 2012 23:28:25 +0000

IFT is no more necessary than conversion to the metric system. A good transaction should take its time and be savored. Nothing better than listening to a telex machine confirming payment details with that sound of ink smashing the paper.

By: PseudoTurtle

PseudoTurtle — Sun, 01 Apr 2012 16:33:20 +0000

Felix, the supposed reason why “America desperately needs immediate funds transfer, or IFT.” is so that the banks don’t lose the “float” while that money is in transit, so your article by not pointing that fact out is quite disingenuous. The “float” from trillions of transactions amounts to a considerable amount of money the banks are losing every minute of every day. THAT is what their problem really is.

By: PseudoTurtle

PseudoTurtle — Sun, 01 Apr 2012 16:20:05 +0000

Just what we needed, a faster, more efficient way to go into debt.

By: youniquelikeme

youniquelikeme — Sun, 01 Apr 2012 01:39:17 +0000

Well Moopheus, when you file our taxes electronically, the payments are processed quickly unless you are one of the quarter million whose returns were stolen by identity thieves.

In that case it takes a mere year, or more, to get back what is rightfully yours.

http://abcnews.go.com/Business/income-ta x-identity-theft-needed-social-security- number/story?id=15834826

By: Moopheus

Moopheus — Sat, 31 Mar 2012 22:50:36 +0000

How many individuals really have this “desperate” need? Most of my personal transactions are either cash for local and debit for online, both of which can be carried out quickly. I get direct deposit at work, and the check is always in the bank when it’s supposed to be. It may be an inconvenience for the wealthy or large businesses that need to move a lot of money through inster-institutional transfers, but it’s hard to really see it as much of a “desperate” problem as some of the other things we have on our plate right now. (And I think someone has nearly IFT-like capacity–when we file our taxes electronically, the payments are processed _very_ quickly indeed!)

By: youniquelikeme

youniquelikeme — Sat, 31 Mar 2012 17:16:39 +0000

A cashless economy … is that a double entendre?

I think one thing America does NOT “desperately need” is immediate funds transfer, or IFTs. While speed, versatility and universal coverage might be important when doing overseas transactions, what makes clearing fund transfers slower also makes them safer to use.

That safety is more important to those of us who don’t wish to be saddled with technology that is simply ‘good for business,’ yet have to use it as the old fashioned ways are saddled with higher fees to pressure Universal use of things like IFTs.

A cheque is something you can guarantee, post date, rip up, void, be stopped/cancelled and needs a signature. People who commit cash cheque fraud are often caught and charged whereas electronically you and they are a blip away.

Cash is something you can see and hold and can count your change, and if there is an error you are holding the proof and YOU get instant access to the cash which belongs to you, back, whereas the business now holds your “money” instantly and the individual is now responsible for the money being taken from their ewallet, or ecard, or ebank…

I am mourning the penny here and so cannot give 2 cents for bigger and better ways to to have access to instant electronic ‘money’ as business will benefit with no cash to steal, but not the individual, who will be a another blip waiting to be exploited by electronic thieves chomping at the bit to have easier access to your ebank.

By: TaxWonk

TaxWonk — Sat, 31 Mar 2012 17:09:42 +0000

Felix: I’m generally a fan and agree with you far more often than not. But, with all due respect — and at the risk of sacrificing whatever very-serious-person policy-wonk street-cred I might otherwise have had by even mentioning this word: Hasn’t the thing that you (and former Fed official Bruce Summers) are bemoaning the non-existence of, already been invented and beta-tested outside of and completely independently of the rent-extraction-racket that is the modern U.S. financial system? I know you’re familiar with Bitcoin, because when I googled “Felix Salmon and bitcoin” I found (inter alia) your snarky tweet from last June deriding “anarcho-libertarian techno-utopians get[ting] their comeuppance” in the “bitcoin fiasco.” And yet somehow, despite the multiple episodes involving hacked exchanges and stolen bitcoins (which have nothing to do with the integrity of the bitcoin system itself — by analogy, those incidents undermine the viability of bitcoin in precisely the same way that the Jesse James gang’s spree of bank robberies doomed paper currency to failure in the late 1800s, i.e., not at all) is still around and functioning just fine as, at a minimium, proof of concept of a viable peer-to-peer “virtual currency,” or, if you prefer, “immediate funds transfer system.”

By: fuller.brandon

fuller.brandon — Sat, 31 Mar 2012 13:18:17 +0000

Also seems that the lack of IFT and persistance of delayed settlement in the US will hamper the move toward a cashless economy that seems to be occurring in other places (like Sweden). Not sure if there are cost estimates of inefficiencies that arise from delayed settlement, but the costs of processing cash payments is non-trivial. A recent Maija Palmer piece in the FT cited a McKinsey study that puts the cost of processing cash payments at €60bn-€100bn annually in Europe. It also cited a study by the Dutch central bank that found the costs to be about €300 per household.

By: MrRFox

MrRFox — Sat, 31 Mar 2012 09:11:58 +0000

“America desperately needs immediate funds transfer, or IFT.” (F.S.)

There are some things America “desperately needs”, but ….

By: klhoughton

klhoughton — Sat, 31 Mar 2012 04:28:21 +0000

My manual typewriter still works eight-plus hours into a power outage, FifthDecade.

Unlike a FiOS “landline,” internet connection, or television, for instance.

By: oneagainstmany

oneagainstmany — Sat, 31 Mar 2012 00:20:27 +0000

Ohmigod ohmigod ohmigod *socialism*

By: FifthDecade

FifthDecade — Fri, 30 Mar 2012 23:34:57 +0000

What dark age period is the US trying to recreate here? I expect you still use pieces of paper with a signature on to pay bills too? What’s next, resurrecting typewriters?