
Making history with FiSync – Real time bank transfers are here - larrys
http://blog.dwolla.com/making-history/
======
larrys
I think it's naive for Dwolla to think that they have a secure system when
it's been untested and will start by being used on a small scale.

While the delay in the current ACH system may not have been a QWERTY type
thing in place to prevent some fraud (in other words it existed because of
real reasons not to prevent "jammed" keys) a system that operates faster is
going to certainly be more of a challenge to get right.

Edit: Specifically I'm not seeing anything on the Dwolla site to back up this
statement: "A system that inherently better protects you than before is live"

------
bradleyjg
That page and those I found linked from it seemed quite light on details.

Can anyone point me to a white paper or something more in-depth on how they
plan to run a full blown competitor to ACH? The legal, technical and security
challenges seem quite daunting.

~~~
neilwillgettoit
I'm still waiting for Dwolla to produce an RFC on this before I even bother
looking into it.

------
ryanackley
Does anyone else find it a little disconcerting that Dwolla would effectively
control the direct financial payments market if this did replace ACH?

Obviously, this is what Dwolla wants but the larger banks must be able to see
it. They're the masters at playing angles like this. Sure it's free now, but
what about when you're a monopoly?

------
shtylman
Why would anyone trust Dwolla for these transfers when they are not able to
even handle the current fraud they get? Using a third party so heavily will
just mean you are completely subject to their whims.

How does this system handle chargebacks? What is the incentive for a bank to
use this over the well established ACH?

~~~
JoshTriplett
> How does this system handle chargebacks?

How does cash handle chargebacks? How can we possibly do so much business with
a financial instrument that provides no way to un-pay someone you've already
paid?

~~~
count
Cash is generally hard to steal in bulk. You can't just get a bunch of numbers
from people surreptitiously and then empty their entire life savings in
effectively untraceable milliseconds.

~~~
JoshTriplett
An absence of chargebacks does not mean "effectively untraceable". Even cash
is potentially traceable, and this seems quite a bit more traceable than cash
(which represents both a feature and a bug).

------
rbehrends
The biggest problem I see is that the system does not seem to have any form of
two-factor authentication at all.

Here in Europe, where online electronic bank transfers have been commonplace
for years, two-factor authentication has been shown to be a must because
otherwise levels of fraud become too high.

~~~
sp332
Are you referring to chip-and-pin? It's broken
[http://www.lightbluetouchpaper.org/2010/02/11/chip-and-
pin-i...](http://www.lightbluetouchpaper.org/2010/02/11/chip-and-pin-is-
broken/)

~~~
rbehrends
No, I am not referring to chip-and-pin, but to two-factor authentication when
doing online banking. Chip-and-pin has nothing to do with two-factor
authentication and is solely for when the user is present. Two-factor
authentication is primarily used when the user is not physically present.

For example, my UK bank makes an automated call to me whenever I am sending
money to a new recipient, where I have to confirm that yes, I want to send
money to that person or institution.

To send money from my German bank account, I use a special external device
(TAN generator) where I sign off on the details of the transaction itself.

~~~
sp332
Oh I see, thank you.

------
bigtones
The user interface for the transfer seemed to be too confusing and disjointed.

You have to enter the money amount at the top of the left hand column, click a
button, and then the other details in a center column. It's not one flow.

------
Codhisattva
This is a real significant milestone for a company that's disrupting the
financial system.

They talk about replacing ACH but the end result is more than that - it's
replacing the ubiquity of credit cards. It'll take years to do but these folks
at Dwolla are smart and working with the right people (from Kutcher for
investment to the Federal Reserve for compliance to credit unions to serve).

Cheers to Dwolla!

