
Banks are so digital it hurts - gyre007
http://www.adendavies.com/banks-we-are-so-digital-it-hurts/
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ci5er
Well, sure. You've got to record transactions in ledgers, and those have been
stored on computers since the 60s/70s.

But on the payments side of the house, there's no technical reason any inter-
bank account-to-account push-pay transaction couldn't be done in under 5
seconds for under ten cents.

But, no! We've got NACHA (but, now, FAST!) (and the Fed with their 2am window)
and and and... And, let's face it: why would a main-street bank want to lose
out on the MT fees when interest rates are, well, essentially ... nothing.

I agree that the banks have some best-in-class reliability and cohort
analytics technology (some of them anyway). The core is kind of antiquated,
but why muck around with "it's already reliable"?

The "core" is slow and inflexible. The cost structure is crippling. The
regulatory environment imprisoning. Legacy interop. Risk. The interbank-
frameworks.

Yes - all digital. And much of it very good work. Yet, (like in medical, but
for different reasons), just because all the bank employees can download apps
from the iTunes store, does not mean that the core is ... agile.

~~~
jdietrich
Note that the author is British. Standard payments in the UK are made via the
Faster Payments Service, which is free and almost instant in most cases.
Contactless payment is near-ubiquitous in the UK, as is mobile banking.

~~~
ci5er
Thanks. I missed that when I read it. The UK also does not have 6.7K banks and
various state regs...

But, still, I was associated with a BankOne thing about two decades ago - they
had been on an M&A spree and then wanted to "merge" about 80 core banking
systems. After about $200M "wasted", the answer ended up being sticking a
service bus in front of the lot and routing to the right core...

And they were _all_ digital too! :-)

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fennecfoxen
Banks! Digital! So digital that our partner integration API is a batch SFTP
upload of CSV files, with most success/failure reports coming back over the
next few days but several coming back weeks after the fact.

~~~
ci5er
Why don't you use EDI? Not that this would resolve the in-house processing,
the ACH delays or the UCC-rule induced delays, but are you doing transactions
that are not EDI-able?

~~~
fennecfoxen
Believe so. BACS is a CSV system, SEPA is made out of XML. I'd have to look up
exactly what Autogiro needs since I'm not at the office. :b

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rtkwe
If you want to read here's the archive:

[https://web.archive.org/web/20160910123651/http://www.adenda...](https://web.archive.org/web/20160910123651/http://www.adendavies.com/banks-
we-are-so-digital-it-hurts/)

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cloudjacker
Well that was verbose

Maybe the four paragraph version was enough

