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Comment by baxter001 | Hacker News Reader

The sensitivity of the traditional bank account and sort number combination is totally backwards, at least in the uk, the only things you can do with a sort code and account number is pay in funds (or set up a direct debit but that's why the direct debit guarantee requirement exists). I'd feel uncomfortable extending my data exposure with my card number when I just want to receive funds.

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The direct debit system is nearly identical to the US ACH system.

Any funds pulled out of your account can be returned by a trip to the bank and signing an affidavit.

The only difference is the inconvenience of having to physically go into the bank to reverse the payment.

With the vast majority of banks in the UK, a simple phone call with the two words "recover it" will suffice. They'll take care of the rest of the boring stuff.

That might be pretty difficult for members of online banks with one or no physical bank locations. I can dispute a credit card charge by email, phone, or even the web.

It's because ACH's version of chargebacks require that you sign an affidavit as part of the process.

I agree. I'm very reluctant to give anyone my debit card number. If it fell into the wrong hands, my checking account could be wiped out for who knows how long. With my credit card I can at least dispute any charges before I have to pay for any of them.

Its my understanding that Visa / Mastercard will protect non pin based debit transactions (since they are really credit transactions). ACH is a different beast, from what it sounded like when reading the article, Balanced is somehow determining account numbers / routing numbers from bank accounts, which would be bad if they got hacked. On the other hand, they could just be issuing refunds to the cards.

We are not determining bank account numbers from debit card numbers.

You're issuing 'refunds' onto the cards without charging in the first place, right?

Unreferenced refunds are generally frowned upon by the card networks. We'll talk more about what exactly we're doing eventually, but I'm not ready to explain it all while we're still building.

I believe this is what Square Cash works http://www.quora.com/Square-Cash/How-does-Square-Cash-work-t...

Only sorta kinda.

In this context we are talking about a merchant selling a product through a marketplace platform, not a purchase. Signing up as a merchant with a just a debit card is potentially a lower barrier to entry, especially for one-off, occasional situations. The alternative isn't your credit-card, it is your bank routing and account number.

Same here in Australia. I could post my BSB and account number here and the only thing people would be able to do is send me money.

Being able to write checks against anyone's routing/account combination in the US always terrified me.

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