If I tried to pay anyone with it I can guarantee they'd say (a more polite version of) "WTF is that? No. Do you have money? Try money."
If you give me your kennitala and your bank account number (10 digits), I can send you any amount of money, no lower limit (there might be an upper one, I haven't tried buying a house GIRO) without paying a fee, regardless of which bank you're with.
When I sign a rental agreement with my landlord, I give him my kennitala and no other details. He sets up a recurring payment request linked to my kennitala. Every month, the bill shows up in my account with a request to pay it, but it's not like a credit card charge, it's merely a request for payment, kind of like the inverse of me inputting my landlords bank details and kennitala myself. I can ignore it if I want to.
Because the kennitala is independent from the bank, I can change banks and my landlords rental bill, along with all my utilities bills, will automatically start showing up on my new account without anyone doing anything.
Also, there's plenty of alternatives, bank transfers are usually the last resort. There's Revolut, Monzo, Ping It...
(UK perspective)
Unless you want to send money to someone who isn't using those services.
I just found that when I would try to send electronic checks here, people got weird about handing over their routing and account numbers. Sometimes I would even say, "You know, the numbers that are on every check you've ever issued." Didn't matter, there was still some weirdness about it.
That's definitely part of why I like Venmo and Square Cash. It's much closer to a unilateral transaction.
>I just found that when I would try to send electronic checks here, people got weird about handing over their routing and account numbers.
I think that uncertainty is definitely part of the problem. The criticality of keeping an SSN secret whilst paradoxically sometimes having to have it on hand to give to specific authorized people seems like a recipe for paranoia.
The honest truth is I don't know if US bank account numbers need to be kept secret. I would hope not, but I also wouldn't be that surprised if someone told me they did. I can understand people taking a defensive stance, but the fact that there is space for services like Venmo to exist is a direct sign that US banks are dropping the ball. Sending money between eachother more easily than using cash is practically the reason banks were invented (although certainly not the reason they are so big right now[1]).
That wouldn't bother me so much, except we've already been down this path. Paypal has rubbed it's name into the dirt by using it's position as an unregulated psudobank to "hold funds for investigation" and gather the interest, or to unilaterally close accounts and thus implicitly seize the funds within.
The idea of a vendor-locked payment system taking root really sits ill with me. It could cause major problems with paying rent or receiving wages for people who don't, won't or can't use compatible smartphones.
Yeah, they kind of should be since the number is basically all that someone needs in order to print cheques that take money out of a given account. The US has a "pull" system instead of the more secure "push" system in Europe where giving out a bank account number is totally normal (and was back in the day before electronic banking too).
Why? That's what they are for.
It can occasionally take up to an hour, but it's rare.
I agree that services like this only serve to fill gaps in antiquated banking systems. From what I understand, in Australia, for instance, people can send money easily for free between bank accounts and do so routinely without 3rd party services - including paying at stores. Circa 2009, a friend from Adelaide rolled eyes that we still used paper checks in the US. We still do.
The only time I've found cheques useful outside of paying for my rental bond (for which you need a bank cheque anyway) is when I've had to pay for something by posting in a form, and I don't feel like writing down all my credit card details on paper and having them stored rather insecurely.
The only other relatively common uses of cheques I hear of here are using bank cheques to exchange money when privately selling a car. Other than that, cheques are dead. As they should be.
man i quit doing that as soon as i could check my balance on the internet and just use a credit/debit card, just make sure you turn off 'overdraft protection' before doing this or you can dig a very deep hole of compound interest.
- signed, an early gen-xer
Using a card isn't some magic solution for someone struggling to manage their personal finances.
What's an example of local banking infrastructure that helps alleviate the problem of needing to pay people money with ease? I'm not even sure how it works on my Huntington mobile app. I know I could do it fairly painlessly with Simple bank. Except it's really only easy if they're a Simple user I think. Otherwise I'll need to get their physical address which will mail them an actual check, or ask for their routing/checking.
Chase Pay makes it pretty easy I think? But really people who sign up just to use that and attach a non-Chase account are doing the same thing as Square Cash, Paypal, Venmo, etc.
edit: huh, interesting. On a Simple bank FAQ page about paying third parties, it also links some additional services:
https://www.simple.com/help/articles/payments-and-transfers/...
Here are a few common and useful services:
* Google Wallet - https://www.google.com/wallet With Google Wallet, you can send money to anyone in the U.S. with their email address or phone number. You can link your Simple account with your card number or your account and routing numbers.
* PayPal - https://paypal.com PayPal offers a wide variety of services. If you’re planning to use PayPal with your Simple account, here’s what you need to know: We cannot link to Paypal accounts under a business name, since your Simple account is for personal use. Some PayPal services may incur a fee. One thing to keep in mind when linking your Simple account to Paypal is that when you're asked for the bank name, you'll need to enter the name of our partner bank, BBVA Compass, rather than Simple.
* Square Cash - https://cash.me Square Cash allows you to send money for free with your debit card. You don't need a username or a passphrase—just the email address for the person you'd like to pay and your debit card number. Transfers are often instant, but they can take up to 1-2 business days.
* Venmo - https://venmo.com With Venmo, you can send money to friends and even authorize other people to withdraw funds from your Venmo balance. Venmo can be hooked up to Simple with your card number (make sure it's marked as debit, not credit), your bank account number, or both.
* Xoom - https://www.xoom.com Xoom primarily used to send money internationally. They do charge fees, which is typical for this type of service.
Interac solved the P2P payments problem for every social group that I'm in there.
I actually use Venmo in Canada with friends that have US bank accounts because it's still more convenient even having to calculate the exchange rate.
Young millennial male, I'd never heard of this thing until now. These things tend to be emblematic of poor local banking infrastructure. This reminds me a lot of echocash[1].
[1] https://www.econet.co.zw/ecocash/