
Bank account verification and transfers in just a few lines of code - teetime
http://blog.dwolla.com/bank-account-verification-and-transfers-in-just-a-few-lines-of-code/
======
bcg1
I have a marketplace that uses Dwolla exclusively for payments. It has worked
out great except for the fact that it excludes most of the world from
participating (those outside of the US) but that is not their fault.

Bank account verification like this is a huge improvement over the we'll-
deposit-some-pennies-in-your-account scheme. We require users to have a
verified funding source in Dwolla... and the 2-3 day wait I'm sure has been a
turn off for many, so this is a cool feature.

Ben Milne seems like a good CEO and the company seems to be run from a long-
term perspective, which is refreshing. Their decision to completely eschew the
credit card processors and provide no-cost online transactions and micro-
payments is also a breath of fresh air.

~~~
aianus
Dwolla is completely unscrupulous and cannot be trusted.

They claimed for years their transactions were 'irreversible' and then went
ahead and secretly reversed (read: just deleted them from the db and claimed
not to know about them) a bunch of transactions that bankrupted Tradehill.
Disgusting company.

[http://observer.com/2012/03/dwolla-was-just-sued-by-
bitcoine...](http://observer.com/2012/03/dwolla-was-just-sued-by-bitcoiners-
for-2-m/)

~~~
pbreit
Give it a rest. This, if true, is an extraordinary situation. Using an online
payment service for currency trading is not the best idea.

~~~
aianus
They _marketed_ their service as free of chargebacks.

1\. The fact that a payment company connected to ACH, a reversible payment
method, would claim something like this demonstrates gross incompetence at
best.

2\. If they didn't want high risk customers like TradeHill they should have
politely kicked them off the service, not kept them on while silently
defrauding them of their money and hoping they wouldn't notice.

> Using an online payment service for currency trading is not the best idea.

What, TradeHill should have expected Dwolla to violate their own terms of
service (no chargebacks) and therefore it's their own fault? That's asinine.

------
hayksaakian
I would think handing over your bank username and password is a horribly
backward and insecure design.

Am I missing something?

~~~
nemothekid
I'm not sure about Dwolla's offering, but on Mint when you do it, it functions
similarly the same as an OAuth login.

~~~
hayksaakian
Well, with oauth, you are not telling dwolla your password. You are telling
the 3rd party, that dwolla (or whoever) can have an access token to your
account, verified via popup to facebook, or a redirect to facebook.

Imagine if "login with facebook" meant "tell my startup your facebook
password".

How is this considered OK?

~~~
simoncion
> How is this considered OK?

If I might snark for a second:

Because banks say: "We're the bank. We're run by Masters of the Universe, we
are the smartest people in the room, and you can trust us and our data-
handling practices!"

To be serious: Having to disclose the same credentials that give you access to
the web UI for your bank accounts to a random third-party in order to use
_their_ service is _insane_.

------
Eclyps
The whole "enter your banking credentials" thing is definitely a bit weird,
but I understand why they do it.

A slightly different use-case, but does anyone know of a good service that
replaces the need for nightly ACH batch processing that works with good old
fashion routing number and account number (and maybe some other details OTHER
than banking credentials)?

~~~
pbreit
Visa Direct and MasterCard Send sort of do that. I believe, for example, that
is how Lyft is offering "instant" payouts (through Stripe).

Curious how important same-day vs next-day is for you?

------
sytelus
This is great. If you are a subscription service or anywhere you need
recurring payments, it's nice to provide this option to users because one of
the reason lot of people stop subscriptions is because credit cards are
flacky, expires or get cancelled. Also large transactions upwards few thousand
dollars can benefit because many people don't have sufficient credit limit
left. Are there any other scenarios?

I think Dwolla should go one step further. How about exposing APIs to get
statements? Getting statements is one of the PITA with banks and many
analytics application scenarios would open us with these APIs if they were
easier to use than that of Yodlee.

------
sremani
This is on their website.. <Quote> Dwolla, Inc. is an agent of Veridian Credit
Union and Compass Bank and all funds associated with your account in the
Dwolla network are held in pooled accounts at Veridian Credit Union and
Compass Bank. These funds are not eligible for individual insurance, including
FDIC insurance and may not be eligible for share insurance by the National
Credit Union Share Insurance Fund. Dwolla, Inc. is the operator of a software
platform that communicates user instructions for funds transfers to Veridian
Credit Union and Compass Bank. </Quote>

So they are effectively piggybacking on IFX calls on these bank servers and
still using ACH (Account Clearing House?). This is a programmer friendly
easily embeddable api for web sites etc. but still using the standard stuff.
To call it "Transfer Platform" is a bit confusing to me. I would be damned if
Dwolla is actually doing an IFX SignOn with those user name and password, for
verifying accounts.

------
jonathanfoster
How does Dwolla compare to Yodlee and Plaid?

~~~
tomasien
Dwolla uses Yodlee or Plaid (I think Yodlee) to verify transfers and then
moves the money. They're a payments service not the data side.

------
lux
Very cool! Is this international or US only? Didn't see in the post and don't
have time to dig for it.

~~~
thisone
looks to be US only, but banking systems in other countries may not need
something like this. And with each country having different rules and
regulations, it's probably a very big nut to crack for a single US based
company.

In the UK, for example, I can easily transfer money to other people's or
business's accounts and it will arrive within 2 hours, and generally it's
immediate.

If you need to transfer between countries, then it gets more interesting and
you get forex's involved.

------
pbreit
I believe Plaid only does this for a handful of banks. Is there a list of
banks this supports? All/most?

------
ilurk
How does Dwolla differ from Stripe?

~~~
ryanlol
Dwolla is an ACH transfer platform, Stripe isn't. Two completely different
things.

~~~
colmvp
Stripe is currently in ACH beta.

When Balanced shut down, they encouraged users to go over to Stripes private
beta.

[https://www.balancedpayments.com/stripe/faq](https://www.balancedpayments.com/stripe/faq)

~~~
Blueliner
Stripe ACH service has been in "beta" for at least two years. I contacted them
that long ago and was told it would be available by the end of 2014 and it is
still in "beta" and not generally available. As the co-founder of an
enterprise SaaS app startup where our average per use charge for a customer to
use our app (we charge on a per use basis not straight subscription) starts in
the hundreds of dollars and can run into the thousands paying the standard
2.9% + credit card fees for every payment vs. $.10 - $.50 max for an ACH
charge is a complete non-starter for us and our customers. All of Stripe's
competitors have had ACH forever including Balanced who we talked to but
Stripe continues to drag its feet and not provide ACH. Clearly it isn't for
technical reasons but because they make significantly more revenue and profit
by not offering ACH where their transaction fee is much less. So while I
respect what Stripe did early on to make integrating payments into an app much
easier than the previous generation payment providers requiring a lot of up
front fees, merchant accounts, etc. we will never consider them again unless
and until they offer ACH and I'm sure there are lots of other enterprise app
companies who won't use them either without ACH because customers demand it
vs. having to run up huge monthly charges on their company credit cards. Too
bad that Stripe management is proven to put their profits (and greed) ahead of
providing cost effective solutions for their customers.

------
irascible
Just enter your bank account and credentials... Dwolla Dwolla Bill Ya'll!!!!

------
tomasien
Looks familiar ;)

------
rbinv
Kind of misleading: this works with a few lines of code _if_ you use/include
their libary. Nice nonetheless.

~~~
bobwaycott
Is it really _misleading_? Where did you expect the integration with banks to
come from? It doesn't even seem like a remote possibility that could be
provided without using/including a library from _someone_. Now one is able to
integrate this functionality as easily as one might add Stripe checkout.
That's a win, isn't it?

This library aside, I've grown accustomed to every "Do complex thing X in a
few lines of code" announcement to, as a rule, mean "as long as you're using
our sparkly new library." So much so that it seems rather silly to even
mention a library is required. Of course it is. The hard work was wrapped up
into a nice interface for everyone to use.

As much as I've grown tired of the automatic developer default to include
third-party libraries to do everything, things such as financial transactions
seem like one area where it's unlikely one will ever be able to do anything
without libraries in a few lines of code.

~~~
rbinv
Yes, I do find the title to be misleading.

Pure checksum verification (used for some account number plausibility checks)
can actually be done in a couple of lines of code. This is something different
entirely.

Please don't get me wrong - this doesn't mean I don't appreciate the library.
I just think adding "with our library" wouldn't have hurt.

~~~
bobwaycott
Of course, "account number plausibility" != account verification.

~~~
rbinv
You are correct. Guess I read too much into "verification".

