
Dwolla is going to eliminate ACH - ScotterC
http://blog.dwolla.com/ach-goes-real-time-with-fisync-free-for-banks-and-credit-unions/
======
jellicle
Who owns ACH? The banks do.

Who owns Dwolla's replacement? Dwolla.

Banks are smarter than that. Adoption of this will be zero.

Instant transfers mean that someone can bankrupt an entire bank - instantly.
If someone hacks this brand-new untested system and issues 100% withdrawal
orders for every customer account, B of A and Citibank and Wells Fargo and
HSBC can all be bankrupted between 10:32:24 and 10:32:25. Ooops!

ACH is slow and revocable _on purpose_.

~~~
InclinedPlane
Indeed. I wish Dwolla the best of luck, but realistically it's going to take a
lot more barbarians at the gate to bring down the existing system and replace
it with something better.

Most importantly, anyone who talks about financial transactions at the level
of shuffling bits around and doesn't address the issues of fraud, money
laundering, regulations, and legal compliance is just not serious about it. If
you want to invent a new currency or a new banking infrastructure, go right
ahead. But unless you are prepared to get into bed with the existing
processors as well as world governments and law enforcement agencies then you
are probably relegating your system to obscurity or worse.

~~~
wmf
Dwolla always talks about how friendly they are with the banks, but it's not
clear why banks wold be friendly with them.

~~~
InclinedPlane
Easy answer: the banks don't see them as a serious threat, so it's easier (and
better PR) to placate them.

~~~
OzzyB
Easier Conspiratorial Answer: _"Keep your friends close, and your enemies
closer."_

The banks get to learn about their tech and keep abreast of whatever "new
groundbreaking innovations" they have, whilst pretending to play along.

~~~
cynicalkane
Projecting sinister and conspiratorial motives on banks has been a popular fad
these last 3 years, but I don't really see why this is necessary to explain
their actions here. There's nothing necessarily sinister about working with
people introducing new ways to do your old business. Actually, that's what you
want banks to do.

~~~
beagle3
Well, I know of one market where this conspirational explanation is exactly
what happened.

Commodity and future exchanges existed, one way or the other, for 5000 years.
The modern commodity exchange traces its history at least to 15th century
Europe, if not earlier.

If you need to change currency, you go to the bank. You would expect a
currency exchange, where buyers and sellers meet to exchange currency, would
have existed given that it's much simpler than a stock exchange / commodity
exchange to run.

Well, bank stifled the money supply to any such attempt, until they couldn't
in the early '2000s -- but they invested and bought the emerging players, to
make sure that their lucrative money changing business is not harmed.

Look up who owns currenex, hotspot, EBS, and the other currency exchanges.
Also, look up the rules - they favor the banks above other players.

~~~
JumpCrisscross
As someone who traded large volumes of commodities, currencies, and their
derivatives, this is false. Most trading of these assets happens OTC, between
private parties, and never touches an exchange. This is far more de-
centralized and efficient than having it happen on exchanges.

The _retail_ money changing business is not so great if you're dealing in
change (<$10k), but as someone who negotiated the rate at which he changed his
Swiss francs into US Dollars at a JP Morgan Chase branch in New York, it isn't
a regulatorily locked market. Having a private banking relationship will lower
the threshold for negotiated rates, too.

~~~
beagle3
I'm not sure what you thought I'm claiming.

> As someone who traded large volumes of commodities, currencies, and their
> derivatives, this is false. Most trading of these assets happens OTC,
> between private parties, and never touches an exchange.

I was not claiming that it does happen in an exchange. I was claiming that the
banks were (successfully, for years) doing everything in their power to stop
such an exchange from forming - do you think that is not true?

I was claiming that the big banks own the existing exchanges, currenex,
hotspot, EBS, is that not true? (I've been out of the game in the last 3
years, the player names might have changed -- but I'd be surprised)

I have first hand experience of big banks exerting their influence on those
(supposedly anonymous) exchanges to kick participants out when their trading
style was not compatible with the banks' interest.

> This is far more de-centralized and efficient than having it happen on
> exchanges.

De-centralized, yes. Efficient? Only for the other party (which is a bank, the
vast majority of the time).

If you want to change swiss francs to USD, and I want to change USD to swiss
francs, if we had a two sided market ("an exchange") to meet in, we'd find
each other, agree on a public, easily discoverable price, and that's it; The
one of of us who was smarter (or could wait longer) would earn the spread, the
other one would pay it; alternatively we would meet at the mid price,
splitting the spread. This happens all the time in exchange traded shares,
commodities and futures.

However, the way it works today OTC is that instead you and I both find a big
enough player (e.g. JP Morgan, or Goldman, or whoever), who makes a market in
the currency - buys at the lower price, sells at the higher price, earning the
entire spread, always. Unlike either of us, that player -- by virtue of its
size and position -- knows the "buy" and "sell" orders of a lot of the smaller
players, and can react accordingly.

> s someone who negotiated the rate at which he changed his Swiss francs into
> US Dollars at a JP Morgan Chase branch in New York, it isn't a regulatorily
> locked market. Having a private banking relationship will lower the
> threshold for negotiated rates, too

That's exactly my point: You would expect an exchange that would make this
into a symmetric, competitive, information efficient market _because_ there
are hardly any regulatory issues (compared e.g. to running a stock or
commodity exchange). The fact that this hasn't happened in 500 years of modern
exchanges is a testament to the stronghold that banks have on currency
trading.

Note that such exchanges have appeared for everything, from bandwidth to
energy to pork bellies - but only in a very limited way for currencies
(controlled by the same old boys network), where it is easiest to start such
an exchange, and such a market benefits everyone except same old boys.

~~~
JumpCrisscross
> _if we had a two sided market ("an exchange") to meet in, we'd find each
> other, agree on a public, easily discoverable price, and that's it_

Every trade is a two-sided market. An exchange differs from OTC only in that
it is more centralised. The NASDAQ is no more an exchange than the currency
markets (both are de-centralised, quote-driven markets).

> _by virtue of its size and position_

Market makers on traditional exchanges have information from volume that
smaller players don't. In fact, the centralisation means the cumulative
frequency distribution of market power trails off faster on traditional
exchanges versus OTC markets (this is why mom and pop can stick guns to the
banks in pink sheets but less so on the NYSE).

> _stronghold that banks have on currency trading_

You don't have to go through a bank. You can list your currency trade on a
currency bulletin board. But they will still have market makers who amass
advantage by volume. Most currency hedgers, except the very largest, go
through a bank because they get good spreads. FX market making is _very_
competitive (a border between you and your competitor doesn't help) and can
always be dis-intermediated. Stock exchanges get a lot of volume from
regulatory fiat. If you really want a centralised FX exchange note that
currency brokerages internally crosses their orders - you can draw a box
around those brokerages and call them exchanges if you'd like.

FX market making fails to make indecent profits save for the effects of
insider information, usually from central banks. If there is a "stronghold" we
were all playing our cards rather stupidly.

> _exchanges have appeared for everything, from bandwidth to energy to pork
> bellies_

Requiring everything be on a quote-driven exchange doesn't make sense - it is
stupid to subject to an illiquid market (esoteric derivatives) and stupid to
subject to a market that's already nearly perfectly liquid (currencies).

As an aside, I would guide anyone looking at Wall Street to note that the
centre of gravity of influence has long since shifted away from the banks and
towards proprietary market makers, e.g. GETCO, Knight, and hedge funds, e.g.
Bridgewater, SAC. For the time being the new citadels of power are
sufficiently de-centralised to be highly competitive with each other and, as a
cohort, the banks.

~~~
beagle3
Reading your reply, I see we're discussing two different things.

You are arguing against centralized FX trading (the logic, and viability of).
But I'm not arguing for it. When I'm referring to an FX exchange, I'm talking
about a symmetric, non-centralized, almost unregulated, two sided open market.
An airbnb/uber for currency. What hotspotfx claimed to be, but isn't.

A place where I can come in and say "I have $100, I want to buy 80 euros", and
you say "I have 100 euros, I want $130", and we'd find each other. TTBOMK,
HotSpotFx and Currenex supposedly offer that, but with great limitations and
favoring the bigger players (who own them). And there are no such venues
independent from the large banks.

Such a system would eliminate paying (half) the spread, which is where
currency market makers make their money -- by letting you trade directly with
me, rather than force us to let the bank net with itself and pocket the
spread. It works for stocks, it works for futures, it works for commodities.
Why can't it work for currencies?

And I know, from working with them, that the big banks actively work against
the formation of such a market; and they have the clout to sabotage that.

> If there is a "stronghold" we were all playing our cards rather stupidly.

Again, I'm not saying that the banks know something you don't. They make money
on spreads (little on EUR/USD, more on JPY/SEK). The stronghold is on the
ability of anyone else to build, say, a "currency ebay".

> Requiring everything be on a quote-driven exchange doesn't make sense - it
> is stupid to subject to an illiquid market (esoteric derivatives) and stupid
> to subject to a market that's already nearly perfectly liquid (currencies).

Nothing is required. But doesn't it seem strange to you that currencies, which
are at least as liquid as other things which are traded in {symmetric,
anonymous, information-equal} venues, aren't -- when the regulation around
them makes operating such a venue much easier than, say, a futures exchange?

> For the time being the new citadels of power are sufficiently de-centralised
> to be highly competitive with each other and versus the banks.

I agree completely, except in FX, which is dominated by the banks.
(Disclaimer: Up to date as of 2010. hedge funds were already at the center of
gravity).

~~~
JumpCrisscross
> _A place where I can come in and say "I have $100, I want to buy 80 euros",
> and you say "I have 100 euros, I want $130", and we'd find each other_

Sort of like what you do with an FX trading account? You wouldn't _have_ to
pay the spread. Of course the price could slip against you while you wait,
which is why most hedgers just pay a market maker (MM) to take that risk.

Or, if you think the spread is so sinister, you can go and make a market on
the spread as well. There are upstarts doing this all the time, once again
laying waste to the claim of banks having a stranglehold on the FX market.

> _...rather than force us to let the bank...pocket the spread. It works for
> stocks, it works for futures, it works for commodities._

You pay the spread to an MM on _all_ of these. Plus a commission to your
broker which includes a commission to the exchange. If you trade a stock on
the NYSE you _always_ trade with specialists; on NASDAQ you only _mostly_
trade with MMs.

The reason there isn't a currencies exchange is because there are a number of
de-centralised, inter-linked currency trading venues in place. It would be
more expensive to trade FX on a stock-exchange model.

> _FX, which is dominated by the banks_

You seem to have a faith-based conviction on this, so I'm not going to argue
it any further. The currency markets are one of the most efficient, i.e. fair,
markets on the planet. As a former trader at a multi-trillion dollar Swiss
bank I can say with supreme confidence that you're far off the mark in that
charge.

P.S. The currency markets work like Craigslist, except where there are tons
and tons of Craigslists that are constantly talking to each other and that
everyone is always connected to.

Note: there are banks that have a strangle on the FX market. _Central_ banks.
And the market still runs away from even _them_. Trust in the fact that if
there was any pinch point in the FX markets the central banks would have found
it.

~~~
beagle3
I see where you are coming from: You're from one of those big banks that
(IMHO) strangle the innovation, almost without paying attention. But as you
seem so much more knowledgable about this, a few answers from you can save me
a lot of money - hopefully you'll agree to answer?

> Sort of like what you do with an FX trading account?

Can you name an FX trading account that matches two users (rather than user
and market maker?) I'd like to move my money there. Doubleplusgood if it's
anonymous like the CME.

> Or, if you think the spread is so sinister, you can go and make a market on
> the spread as well.

Have you tried that? I have. And got thrown out of multiple FX venues because
I was profiting at the owner's expense; all of these venues profit by making
markets and netting locally. In a symmetric market, there's no other player
who can throw you out when you're smarter than they are. The best they can do
is not trade with you (and if the market is anonymous, they can't even do that
without stopping trade entirely).

And depending on your strategy, the spread might be very sinister. I can
(could, anyway) make money on the super competitive EUR/USD if I'm allowed to
make markets. I can break even on the buy side if the spread is <1 bp. I can
make more on currencies with larger spread if I'm allowed to make markets. But
I'm not.

> You pay the spread to an MM on all of these.

Dude, have you ever traded CME, Eurex, Liffe or almost any exchange other than
NYSE and NASDAQ? (or, traded NYSE/NASDAQ these through the old INET or ARCA?)
If you paid to an MM when you did, your broker was cheating you. There were no
privileged market makers on these exchanges.

> As a former trader at a multi-trillion dollar Swiss bank

Funny. As a former quant whose software traded trillions in notional (not that
it says much, given that 3 eur roundtrip could get you >120,000eur notional) I
can assure you I know what I'm talking about. And no, it wasn't in the NYSE or
NASDAQ. And no, I wasn't paying any MM. And yes, if I had to pay the spread, I
wouldn't be able to make any money.

> there are a number of de-centralised, inter-linked currency trading venues
> in place.

Can you name one that has symmetric anonymous trading, like CME or Eurex or
LIFFE does? Because the biggest names that claimed to (Currenex, HotspotFX)
didn't - and I know that because I witnessed that first hand.

If you can, I'd be happy to start trading there. Please let me know of one.

------
c4urself
Just moved to the Bay Area from the Netherlands and I feel like I took a few
steps back in time when I received _checks_!? from the bank I signed up to
here.

People pay each other through bank transfer in the Netherlands and can expect
to receive the money on the same day (if sent before noon). On top of that it
doesn't cost money to do a transfer.

I've already gone to a bank more often here than I would in the Netherlands in
a whole year. Setting up recurring transfers for example, or transferring to
someone in another state is just difficult via online.

In other words: there is definitely room for improvement here, America has
been held back in banking

~~~
fiatpandas
As an American who has lived and banked in the Netherlands in the past, I
couldn't agree more.

I loved the free transfers and how easy it was to send someone money. The
efficiency of Dutch banking left me in awe. I remember specifically a banker
telling me while I was opening an account: "Oh, and we don't use checks here.
We like it that way"

"Random readers" are pretty awesome as well. I kept mine after I moved away.

America needs to catch up.

~~~
arethuza
I'm in the UK, currently I have one cheque based transaction a year (paying
for the maintenance of our shared gardens) and one cash transaction a month
(getting my hair cut).

It feels very odd going to the US where you have to _sign_ with a pen when
paying by card (rather than chip-n-pin).

~~~
tbrownaw
_It feels very odd going to the US where you have to sign with a pen when
paying by card (rather than chip-n-pin)._

The fun part is that that signature doesn't seem to do anything. It used to be
that occasionally the cashier would check it against the signature on the back
of the card (years ago), but now they never do that. They seem to have stopped
asking to see my ID in the last few months as well... so now I can just swipe
my card (or presumably someone else's card that I "found") and draw a smiley
face on the signature pad, and _that's it_.

~~~
Q6T46nT668w6i3m
Totally.

Recently, an engineer I work with (I work for Simple) asked if we could add an
image of the signature to transaction metadata in our web and mobile
applications. I thought it was a neat idea, so I started asking around, but
was dismayed when I found out that the whereabouts of electronic signatures
was completely unclear.

Can any network or point-of-sales people tell me if the signature is being
transmitted? Stored? Analyzed?

~~~
PeterisP
The signed reciepts are stored; and in case of a chargeback or transaction
dispute the merchant has to provide them. Only then they are analyzed, but in
practice it doesn't matter, any scrawl is considered as good as another. The
only case where I have seen signature analysis being actually useful was a
case where the customer was attempting to defraud the bank/merchant - claimed
a stolen card but actually bought the stuff himself. But that is very rare
compared to real stolen or skimmed cards, where signatures are pretty much
useless in fraud prevention or shifting liability to someone else.

------
ChuckMcM
Most of the comments on the first page here are about how Dwolla can't
possibly succeed because either the banks won't let them, they don't
understand what they are trying to do, or there will be some sort of financial
event which will ruin everyone's day and destroy the company.

I don't know if that is true or not, but I do know that these are their
problems to attack and I'm glad they are attacking them. Having known people
who were victims of ACH Fraud it makes you wonder where all those billions of
fraud dollars/euros/etc go.

So unlike PayPal, these guys have investors/partners that are in fact
financial institutions. Further, those institutions can no doubt provide
things such as an account that is 'plugged in' to the financial infrastructure
that is the world.

I can see no barrier at all to someone opening up an account with Viridian,
depositing some money in it. And then using the Dwolla payments system to make
payments too it and get money from it. That is all you need for one seller on
Ebay, or Etsy, or whatever to set up their store.

Now if that person has any success at all, and I see no reason that the
payment system would be any more of a barrier than the original use of PayPal
with Ebay before Ebay sanctioned them was, then the payment stream will grow.

If Viridian goes from having 1.4B$ in assets to have 10 - 20 - 30B$ in assets
because folks are creating accounts there to hold money for their endeavors,
the other banks _will_ notice, and the world _will_ respond. I could be a
negative response like they did against Discover Card but again that is a
challenge that Dwolla apparently has signed up for.

So I'm interested in the ways instant payments can be used usefully. In game
purchases? Kickstarter like funding? Etc.

~~~
arethuza
I thought depositing money in a bank creates a liability for the bank, not an
asset.

~~~
surrealize
Isn't it both? An asset (the cash) and a liability (the responsibility to give
you cash when you want to withdraw)? The cash is often turned into other kinds
of assets (loans, say), but it still starts out as an asset.

~~~
arethuza
Ah yes, of course :-) The cash is an asset and the liability is what is owed
to the depositor.

------
leoedin
This is the kind of thing that legislation _does_ help with. Here in the UK
the faster payments[1] system was introduced about 5 years ago, providing near
real time payment services between banks. It's fairly common for British
people to pay each other with an instant bank transfer rather than paypal o
similar when buying stuff online.

[1]: <http://en.wikipedia.org/wiki/Faster_Payments_Service>

------
tsunamifury
I actually worked on mobile and online ACH payments system for one of the
largest Banks in the United States. The entire mentality of startups of "get
it going and refine it later" does NOT work with banking. Before you even
launch you have to get your risk of fraud and security breaches down to 0.001%
or less. The bank I worked with had risk on the order of 0.00001% (1 dollar
was at risk or suspicious for every 10 billion dollars transfered).

On top of that take into account integrating into existing payment and
collection systems and you've got a whole lot to overcome at a relatively high
price.

This is not a place I would even WANT to disrupt. The banks have established,
high quality, insured, and regulated ways of handling ACH (you can even do it
on your mobile).

The whole instant transfer thing seems downright crazy to me, as the banks
still would have to do eMoney/Fed verification on the transfers which has
mandatory delay times. I don't know what Dwolla is thinking...

~~~
Karunamon
>The banks have established, high quality, insured, and regulated ways of
handling ACH (you can even do it on your mobile).

The main problem is speed. The fact that it takes two days, sometimes more,
for a few bits in a few computers to flip, in 2012, is absurd, regardless of
how many fraud checking algorithms you have to run it through.

~~~
tsunamifury
The fact that you'd call the mass transfer of funds from 10,000 plus parties
to a single source 'a few bits flipping' shows you have no idea how ACH
payments work. There are multiple checkpoints, several systems, including the
eMoney/FED that these payments need to pass through.

You also need to deal with the actual transition of funds (which are NOT
BITS). You forget, you are moving real currency here which needs to be
accounted for and balanced between the parties.

~~~
Q6T46nT668w6i3m
While I agree it's a misnomer to summarize ACH as trivial (NACHA's Operating
Rules & Guidelines are mind-numbing), a far-reaching near-real-time payment
platform isn't impossible. Establishing such a network is obstructed by
bureaucracy, not technology.

------
alister
Wow, so many Cassandras and hostile comments here on HN about what seems like
a courageous idea to me.

Does anyone here believe that the _current_ system of ACH, checks, Visa, and
Mastercard is good?

Anything involving banks and credit cards (in the US at least) is choked with
government regulation (steadily worse every year), entrenched players, and big
built-in fees. We pay probably 3% more for every single consumer item thanks
to credit cards.

What Dwolla is proposing is not _impossible_ \-- it's not like a perpetual
motion machine. At least they are heading in the right direction: trying to
bypass some of the regulation, oligopoly, and fees.

Assuming the status quo in direct payment sucks--we can agree it sucks?--then,
why beat down someone who's trying to do something about it? Especially if no
one is offering a good alternative.

~~~
PeterisP
It's not choked with government regulation - it's not being forced by
government to improve. Do you know how EU got from the exact same mess to
where it's payment services are now?

What the EU did a number of years ago was to issue a directive (approx. a
federal law in US terms) about consumer payment services which essentially
said "consumers have the right to have their payments be credited to the
beneficiary within 1 business day. If it doesn't happen, consumers have the
right to demand compensation from their bank for each such transaction. Banks
have a transition period of 5 years to make it happen."

The US ACH systems are slow and expensive because the banking industry
benefits them from being that way, and there are currently no powerful
incentives to improve.

------
abalone
> IT’S FREAKING REAL-TIME!!!

Nothing inspires confidence in a brand new replacement for the fundamental
backbone of our global financial system like the use of the word "FREAKING".

~~~
larrys
"Nothing inspires confidence in a brand new replacement"

Agree. You have to understand who you are selling to. Banks and the people
that work for them are conservative. A total Kool Aid moment.

------
mritun
FYI, in India NEFT
([http://en.wikipedia.org/wiki/NEFT#National_electronic_fund_t...](http://en.wikipedia.org/wiki/NEFT#National_electronic_fund_transfer))
and RTGS (real-time gross settlement) offers instant free* fund transfers and
all large and most small banks are members.

I wish them luck, but Dwolla probably doesn't realize that banking systems
change only by Government & regulatory mandates. The amount of money that
flows through the system and regulations are not trivial.

------
nohup
There is the Check 21 Act[1] which does not need ACH and is not subject to any
of NACHA rules, regulations or fees. Banks already use it and if it is
integrated well, it brings down the payment time to 24hr.

Check 21 describes a file format that is used by banks and service providers
to upload payment information to FRB.

[1] <https://en.wikipedia.org/wiki/Check_21_Act>

------
18pfsmt
I think this note from June, 2010 about same-day ACH payments is relevant
(note: this project has been stalled as far as I can tell):

[http://www.americanbanker.com/issues/175_123/same-day-
ach-10...](http://www.americanbanker.com/issues/175_123/same-day-
ach-1021567-1.html?zkPrintable=1&nopagination=1)

------
guimarin
I really like dwolla, but I think this particular innovation should have been
implemented differently. Instead of giving this product away for free to
banks, et al. It should have been release open source for everyone to use for
free, with support costing banks, et al. No requirement to use Dwolla as the
vendor between banks and consumers. This would really have been disruptive. As
it stands, Dwolla has just figured out how to be a better Mastercard. Still
some progress is better than no progress, so I extend a heartfelt thank you to
Dwolla.

~~~
wmf
Dwolla is a service, not a piece of software. I suspect the barrier to peer-
to-peer payements between banks is not the software anyway.

------
antidaily
One of the few instances where you can use the word "disruption" seriously.
Holy cow if this takes hold.

~~~
untog
Well, you can only use the word "disruption" if it actually disrupts. Given
the vested interests at stake, I'm not convinced that it will.

~~~
drumdance
Yeah, to me a disruption is something that incumbent players have no choice
but to either adapt to or die, like Borders vs. Amazon. If the incumbents
still control the value chain, then it's not disruptive. (I have no idea which
is the case in this particular market.)

------
mbreese
Entrenched interests aside, the fact that is costs nothing worries me.

They are asking financial institutions to abandon (or at least partially
switch) from the 40-year old ACH to a brand new system that has no means to
support itself outside from the host financial institution, namely Dwolla. So,
you're asking the banks to make the stability of Dwolla their concern. Is that
really a good way to gain confidence?

If they wanted to make this a serious effort, they would have to charge some
kind of membership fee, or transaction fee, just to make it an independently
viable business. The fees could be as low as possible, but without them,
you're left with banks relying on a "free" system. No one is going to take
that risk.

~~~
hinathan
From the site — "same price as an ACH transaction" — so a few to tens of cents
per transaction.

~~~
mbreese
That isn't mentioned in the linked article at all - they just say "free".

However, if you go to the actual API site: <https://fisync.dwolla.com> it does
say the same cost as an ACH transaction.

~~~
xanadohnt
I believe what they're implying is that what's free is use of the
infrastructure but each transaction through the infrastructure incurs a fee.
Contrast that with a CC payment gateway where you're paying $30-$40 per month
in membership fees regardless of whether you even process payments for a given
month.

------
shtylman
I recently wrote a bit about why I think Dwolla doesn't understand their
problem and what the core of their business really is. I have a strong doubt
that a central entity is the best way to approach the problem of money
transfers and after talking to Dwolla representatives don't feel comfortable
ever giving them access to my bank accounts.

Popmoney is already partnered with many banks and I believe they are in a
better position than Dwolla at this time to provide such services if they put
an API on top of their system.

<http://www.shtylman.com/archives/319>

~~~
toomuchtodo
Popmoney is pathetic; three days to move money between accounts at the same
bank (PNC Bank). I might as well go into a branch, withdrawal cash, and
deposit it into the destination account, in which case the transfer is
instant.

------
IsaacL
I've heard that these guys (YC S11) are doing something very similar in the
UK. <https://gocardless.com/>

------
PeterisP
Trying to replace ACH has quite a few interesting elements that you must
solve. A decent ACH must offer guarantees that payments are final and will be
settled - even if the sending customer was banking with Lehman Bros, and the
payment was received the day Lehman went down. Otherwise your system would go
bankrupt with the first financial crisis; and since it's obvious, then no bank
would use your ACH.

------
jarin
I really like what Dwolla is trying to do, but it's completely useless to me
until I can:

a) Use a credit card to make instant payments on Dwolla

b) Get a Dwolla debit card to make payments online or at stores

I know they are trying to get rid of those ideas, but until they can make the
transition easier I have to stick with PayPal (even though I hate them).

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lvh
All of this awesome US payment stuff makes me sad to not be in the US :-(

Please make Dwolla available for HK customers. Pwetty please. Heck, we've
seriously considered incorporating in the US just to be able to use
Stripe/Dwolla...

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wheelerwj
I am excited for this. Very very excited. This is exactly the kind of
disruption we need.

It is a bitcoin economy without the awkwardness of the bitcoin.

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kfcm
Here's a question for those in the banking world:

How would near-real-time payments impact a bank's reserve requirements?

~~~
PeterisP
From the mandated reserve requirements point, not at all. From the practical
liquidity point, the bank's treasury dept might need to keep a bit more cash
in hand, and would earn less on 'float', so they won't be happy, but that's as
intended.

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draz
i dont know much about this industry, but I am guessing the delay works to
some organizations' advantage. Don't they get to keep the money longer in
their accounts and thus have better cash-flow (on paper, at least)?

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Codhisattva
Epic disruption going on.

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wamatt
Naive hype.

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btipling
I am fine with banking being boring.

