Ask HN: How can I start my own bank? (Let's redesign banks)

Re:Ask HN: How can I start my own bank? (Let's redesign banks) by cschneid on Wednesday January 13, 2010 @11:29AM (#1050413)

The giant hole in usefulness of banks that I see is that doing bank to bank transfers of money aren't easy on a customer. For example, I have my checking account at one bank, and my car loan at another. In order to pay my car loan, I drive to bank #1, withdraw cash, drive to bank #2, and deposit.

EFT is mostly inaccessible to customers. Checks work, and would avoid the bank #1 in my process, but take extra time to clear. Wire transfers work, but would charge me a decent sized fee every time.

Basically, it shouldn't be so difficult to transfer money between banks at the customer's level. But I also understand that interbank coordination is done at a higher level than any one bank. So ING for example can't just say "here's a new interface" and let people go for it.

I suppose my question is: how do we advance the banking system in areas that require system-wide simultaneous upgrades?

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Re:Ask HN: How can I start my own bank? (Let's redesign banks) by shamir on Wednesday January 13, 2010 @05:49PM (#1051395)

Actually, there is a system in place for any bank to transfer money to another account at another bank. Its called ACH (http://en.wikipedia.org/wiki/Automated_Clearing_House), and thats how direct debit and most other interbank transfers in the US work. Internationally there is SWIFT and wire transfers, but within the US all that you really need is a name, account number, and bank routing number. All of this information is printed on a personalized check from any bank; thats why some people ask for a void check to setup auto-pay.

That said banks in the US have been very very slow to make this technology easy for customer's to use, partially because they just suck at user friendly technology, and partly because they don't want to make it too easy for people to move their money to an account at another bank.

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Re:Ask HN: How can I start my own bank? (Let's redesign banks) by mcherm on Thursday January 14, 2010 @12:34AM (#1052008)

Well, ING Direct tries to make it reasonably easy for our customers to make these sorts of transfers. For instance, once you set up a "linked" account (ie, prove to us that you own an account at another institution) you can transfer money between them at any time with a click on our website. If you have "Electric Orange" (our checking account), then you can also do things like sending a payment electronically (pick it up by email) or having us mail a check.

In a way, I think we HAVE said "here's a new interface" and let people "go for it".

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