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Comment by grecy | Hacker News Reader

Moving from Australia to Canada/US felt like going back in time 20 years when it came to banking.

Even ten years ago in Australia I could do more with my online banking than I can today in North America.

Checks are for what now?

Moving from Norway back to Australia felt like going back in time 20 years when it came to banking! In Norway I'd get a new bill and enter the code into my banking and it would offer me an option to "automatically approve up to X per month for this vendor".

Automatically approved bills didn't get auto paid - but they appeared in the "upcoming bills" when issued, with a pay date of the due date on the bill. I could go an hit "pause" or "stop" on any bill - and it either wouldn't pay or would be removed entirely. Anything that wasn't auto-approved would start in paused mode and I'd have to manually approve it - but that was a single click.

Still, I agree that when I'm in the states it feels crazy old tech. They still require signatures on credit cards!

BPay gets you close with that. Had that for years and years at this point.

Now we have Osko and PayID which is immediate free payments without needing to remember bank account details. It’s neat!

Yeah, PayID is pretty cool.

I was doing that 10 years ago in Australia with BPay...

Checks are for what now?

For me this week: Paid for a city license, paid the cat sitter, paid for a small magazine subscription, made a charitable donation, and paid the rent.

The cat sitter and the charity were check only. No other option. The magazine has a PayPal option, but I don't trust PayPal. The city license could have been done with a card online, but I'm not interested in setting up yet another account with yet another third party to mishandle my information. Paying the rent by check is free, but paying with a credit card is a $74 fee. And this is with a very large company that almost everyone knows.

People do abandon checks when possible. But for the most part it's the businesses that put up barriers. Or, in my case, a lack of trust, which has caused me to use checks more. I like the paper trail. I check my bank statement every month and at least once a year there is an error.

I am coming around somewhat on the trust thing. If I can use a virtual credit card number, I will. But not if I have to make yet another account with yet another password and yet more gathering of information that is nobody's business.

Edit: I forgot that I also had to send a check to a county recorder out if state to file some legal documents. But that was a cashier's check, not a bank draft. Still, the only form of payment accepted by that county government is cash if you live there, or a cashier's check if you're out of state.

Also, my accountant only takes cash and checks. I consider it a virtue since it indicates that she watches every penny. But I didn't put that payment in the list because it was a couple of months ago.

When your life is simple, banking is simple. As you get older and your life becomes more complicated, banking gets more complacated.

I know. In America, it's such a bloody nightmare with the cheques everywhere. This should obviously be first-class supported by banks. If I could just set up direct debit that would be so much better. It would all show up on one screen, I could see what this months aggregate direct debits are, what they are to each account. You could even just use the 'Transfer Money' functionality to one-time things if you don't want to give repeat access.

And to top it all off, the American bank cheque system is so insecure.

Yeah, it's hard to secure a system where paying someone involves giving them your name, address, bank account and routing number, and signature.

I have not written a check in over 10 years. I do, however, use my bank's online bill pay system. When I was a renter I used this to pay. I don't have to touch any paper, or stamps.

I envy you. I'm trying to get back to a simple life, but it's hard. Some day.

Yup, the online bill payment ends up sending a check anyways, but saves me having to find a stamp and envelope.

I started renting a studio a couple months back. They gave the option to pay with a paper check or with a credit/debit card online. Online transaction came with a $20/statement "convenience fee". Meanwhile a mailed paper check is $0.50 including postage. Paper check it is.

I never understood this logic. We’ll hand process your check for free, but if you want to use this website we set up, it’ll be a $20 “convenience fee.” I get passing the debit/credit fee onto the consumer, but it’s there even when I were to choose ACH.

Probably because the party doing the ACH is a third party agent/ISO but the checks are probably cashed directly by the management company. The thing that your management company probably wont tell you is they get some kick back on the profits from those fees you're being charged. So not only do they get your rent money but they also make money on you using electronic payments.

> For me this week: Paid for a city license, paid the cat sitter, paid for a small magazine subscription, made a charitable donation, and paid the rent.

Even ten years ago in Australia all of that was done through internet banking, and if I wanted to I could set it up to pay those automatically when the next bill came in (or not, it's up to me).

I've never written a check in my life (I'm 37), and whenever I get one I laugh and am shocked people still use them.

What I don't really get is why American payment systems insist on including some way to pull money out of an account, which therefore requires massive amounts of trust.

The way the European system works is that there is one possible operation; the owner of an account can move money from their account to any other account.

If you want me to pay you rent, you provide me with a standard format bill, which includes your account number, the amount, the date to pay by, and an optional reference number (for use of the recipient to tell what I was paying for). To pay, I input those into my banking app (or more likely, read the barcode on the bill with my phone), verify that everything is correct, and press a button to transfer funds.

The point is, I don't have to trust you to do any of the banking right. I have paper trail from you in form of the bill you provided (which confirms that the numbers I used are correct), and from my bank that the transfer was initiated on a given day at a given time. There cannot be any error that I didn't make.

> The way the European system works is that there is one possible operation; the owner of an account can move money from their account to any other account.

This isn't true at all. The direct debit system allows any participant to withdraw money from your account, providing just your account number and a claim that you authorised them to do that. You never have to directly tell the bank anything, and in many cases you can't even opt out of the process or deny access to an individual withdrawer through the bank.

The banks are meant to limit access to the direct debit program to companies they trust, and cut off access to bad actors, and make whole customers who were debited in error or by fraud. How enthusiastically they do this depends on the bank and the local regulator.

You're required an ID card (in most country in europe, a digital id) to prove your are the owner of the bank account and in case of a procuration, you still have to prove you id and you need the procuration itself which contains reference of id card of the account owner and other details.

You could theorically withdraw money from an account by faking the procuration, providing you know the id details of the account owner, but you are still required to present your id card which contains a digital photo of you to prove you are who you pretent to be.

Fake id are maybe common in the us thanks to your broken SSN system but in europe, digital id cards are centralised from the moment you're registered as human being at your birth and banks have access to that system when they check your id.

Any attempts to withdraw money from your account leave a trace, and in case of fraud, you would be quickly with the cops on your trail.

Don't generalize all of Europe (or the European Economic Area) unless you are confident that you are correct.

The UK and Denmark don't have identity cards. At least in those countries, there is occasional fraud. The banks will fix it (at least in the case you describe), but it can happen.

Not sure where you're from, but here direct debit requires setting up "direct debit agreement" by the owner of the account, that specifies account number the debit comes from, how often and maximum amount.

So you setup something like "account 123 can debit up to 100 EUR monthly" and the bank enforces that.

I'm 40 years old in Australia and I have never had to use a cheque in my entire life.

In Australia, all of those could be simply done with an online bank transfer instead of a cheque.

Functionally it's the same thing, except that instead of writing on a piece of paper that you're giving the bank authority to withdraw your funds, you're doing it online. It takes less time, it's more reliable, and you get even better record keeping, as you can enter notes when you make the transfer.

Canada has Interac E-transfer which is convenient and free depending on which bank you bank with. I pay my rent with it for example.

I use checks to pay vendors I don’t like, like the for-profit power utility my building forces me to use.

I have stamps to use up, and it costs them probably $7-$10 to handle it.

There is no way depositing a check costs $7 to $10 for any decent size business as they’re already probably handling checks. If anything, a check payment is cheaper as it’s more secure for the recipient in case of a dispute.

Someone has to open it. Someone has to key it into a billing system. Someone has to scan it. Someone has to archive it. Some process needs to occur to verify that the payment indeed went through.

I doubt their remote deposit app is any less clunky than the consumer one they give me. If it’s better, they’re paying for it.

Someone needs to manage those people. And they need space to do their work.

I could see it taking 15 minutes in total labour costs.

Those people likely do many other tasks. Removing checks from the equation would not eliminate their jobs.

It's entirely possible that all of those someones are outsourced. If they're using a lockbox service[1], the entire cost of processing your mailed check can come out to less than $1 (substantially less with sufficient volume). And at the same time, many lockbox services will expose your data to offshore contractors doing the manual components.

[1] https://en.wikipedia.org/wiki/Lock_box

I use checks all the time actually. Every other form of payment online is “pull”, I only want to “push” my funds to external people.

i've never used a check in my entire life. when i need to pay someone i just do an online transfer.

That's not actually correct. By giving an external person a check, you give them the ABILITY to PULL funds from you. It looks like a push, but it's actually not.

https://www.bankrate.com/financing/banking/writing-checks-in...

More importantly you're giving them the authorization.

Everyone already has the basic ability to pull funds from arbitrary checking accounts. heh.

Knuth had to quit giving out real checks (which nobody actually ever cashed, anyway) for exactly this reason.

They probably meant a fire-and-forget method to pay untrusted parties without giving them the ability to charge more than agreed.

Chargebacks are a thing, but they require constant vigilance and the occasional bureaucratic task.

Checks have substantially less security there. Not more - and even if/when it gets fixed the money comes out immediately.

That’s what wire transfers are for in EU. Same day/instant, either free or with a flat fee of $0.25-0.5.

In Poland if you’re going out with friends and someone paid for you bc you forgot a card, you just wire them money from your phone.

For my whole adult life (36 yo) I only used and saw an actual check once. Wire transfers since I can remember.

Since a few years ago, you were also able to use the BLIK system to transfer money instantly for free between most banks, by only knowing the recipient's phone number. To be fair I can't imagine anything more convenient.

In NL we have "Tikkie", where you just have to give them a link, whether it's by whatsapp, email, IRC, whatever. Sounds slightly more convenient as it's not based around a phone number (but can be if that's what you have :)

> Every other form of payment online is “pull"

Sorry, but if I transfer funds to a friend from my banking app, how is that "pull"? If I send you money with PayPal, that's not "pull". If we settle our debt using e.g. TransferWise, that's not "pull"..? I don't get your point. There are plenty of "push" methods.

If PayPal decided to charge you a $10 per month for “maintenance costs”, how would you stop them from doing so?

Well, if they're not authorised, dispute it with the bank?

https://www.directdebit.co.uk/DirectDebitExplained/Pages/Dir...

Can you pay your electric bill with those?

Yes, I pay all my bills by bank transfer (house, electric, internet, settlements with friends etc). It's the most common payment method here (I'm in Europe).

PayPal et al are barely used here because the bank transfer system is free and frictionless.

I'm guessing, but I think most people probably give the electric company permission to pull the money from their account (direct debit) rather than reviewing the bill and "pushing" the money every time.

There are very strong guarantees in the individual's favour if the company makes a mistake.

Although, you need your bank to actually fulfil the guarantee, depending on how terrible your bank's customer service is, this may be a lot of trouble.

I've actually done this (use the DD Guarantee to unwind bill payments I didn't want paid) with my good bank and it was a pleasure, no trouble at all. But I can imagine that a bank with bad customer service is going to make it a nightmare that will suck up hours of your life.

I doubt it, they might lose their banking license over it.

SEPA direct debits allows for R-transactions to unwind a collection up to 13 months after execution, no questions asked, it’s wild.

Yes, having them control the amount and timing of the transfer is exactly what I am trying to avoid. I can easily set up direct debit, but it has led to too many erroneous and poorly timed withdrawals.

In the UK, larger companies usually allowed a choice of the date the payment went out. (After all, they'd rather not deal with failed payments.)

I keep enough money in my accounts (partly because of this) that I don't really care about it, but I'd be surprised if they don't use the preferred date.

In Sweden we have an e-billing system where your bills show up as PDFs in your internet bank and then you hit accept or deny (and they go in a queue to pay on either the due date or a date you pick). You can also set it to auto-accept new bills from the same company if you want to emulate how direct debit works (with the added benefit of having a period of time between the bill coming in and the due date to verify the amount is right)

If you want to stick to paper bills, they all have the receiving account number and customer reference number so they can be paid manually via a transfer.

In the Netherlands, we had that for some time but sadly it didn't catch on with the utility companies, housing associations, insurers etc., and has been discontinued. I would love such a central place to manage my bills and pay them on my own time instead of using direct debit which most of them nudge us to use now by introducing costs for other payment methods.

So the electric company gives you their account number to use?

Yes, as an example here's a major British energy company:

> Our bank details are: > Bank account number - 99183129 > Sort code - 57-40-99

https://sse.co.uk/help/bills-and-paying/how-to-pay-your-ener...

This company is easily large enough that their bank details are already listed in online banking systems. You can choose "Pay a bill", then select "Southern Energy" rather than type in those account details.

Actually, several of my bills work that way, but the bank hides the details.

Yes, you can. However, since the last few years, the electricity company has started to charge something (about € 1,50 per month I think) for that. (Netherlands)

The numbers at the bottom of the check are all that someone needs to initiate an ACH transfer out of your account!

> Every other form of payment online is “pull”, […]

Wat? When I transfer money to another account via my bank's ebanking app that is very much "push". The transfer is executed either immediately or at the end of the business day. Nobody is pulling anything.

I assume you live in the EU (or somewhere else outside the US), where it is the most natural thing to just send money from your account to another one.

This simply isn't a thing in the US, as I discovered when moving to there for a time. They use third-party apps, cheques, and wire transfers (which are expensive and seem to work via ACH, a pull type system). It's simply not possible to go into your ebanking app and transfer money to someone elses account. (With very restrictive exceptions, e.g. same bank, or maybe the bank has integrated a third party service...)

As inconceivable as the American system is in the beginning for somebody coming from the EU, I guess for many people from the US it's similarly non-obvious that a push system can (and does) exist somewhere else.

But why? It just doesn't make sense to not have a push system. I, honestly, don't get it.

Lived in the USA all my life, have always wanted to have direct transfer as you describe.

Nope, "online push" is ubiquitous in civilized countries.

Don't get me started on filing taxes!

I think the point here is that the various bills I have to pay don't give me their bank account number, but they ask for me to give them our account information so they can automatically subtract whatever amount. If they would give me their account numbers, I would gladly send them funds. Instead, I use my bank's online bill pay to generate a check for them.

>I use my bank's online bill pay to generate a check

which has your account information on it

(I do the same thing, though.)

I am not so much worried about the fraud aspect, as I am explicitly giving them permission to take amounts of their determination from my account without my explicit agreement to the amount of each transaction and on their schedule.

Sorry if I'm out-of-date, but how do checks work online?

Like, to pay for something remotely? I’ve emailed a picture of the check to sellers who refuse to use PayPal and then they use their bank’s online deposit system to drop it into their account (a couple of times for second-hand board games).

Thanks for the reply. But, that sounded very unsecure. What happens if a third party cashes it first, you say you didn't share the picture, the merchant says they didn't share the picture?

You’re stuffed, you’re supposed to only exchange the physical instrument so you’d be liable for fraud.

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