So why are middle men taking a cut in the US that other countries don't have?

Why electronic payment costs money in the US? That's the cheapest way to pay and process payments. In Finland that cost's nothing and it's the default for paying large bills and payments.

Because the EU told the banks not to charge for transfers, essentially. It will be interesting to see what happens in the UK once they truly leave.

the fees for credit cards are like a tenth in the EU vs US. It's not free though.

EDIT: "for credit cards"

Nope, since 2017 the law has been that bank transfers anywhere within the EU are free.

https://brussels-express.eu/bank-transfers-will-immediate-fr...

This doesn't sound like it covers credit card interchange. Does it?

In most European countries SEPA and its predecessors have taken this role for most people. I’m 34 and have never had a personal cheque book; there’s just no need.

It is a cultural thing to an extent though; there are EU countries where they’re still used to some extent despite the presence of a modern banking system.

I'm not european, so am unfamiliar: would you use a SEPA transfer for, say, a $1000 tv from a small business retailer? What about buying a $3000 used car from an individual?

I bought my last two cars via SEPA, the first from an individual, the second from a dealership. Both were used, but still significant sums. In both cases I of course had a signed contract in hand before sending the money, and have done a bit of due diligence on my business partner (I met the private individual at their home address, and checked out how long the car dealership has already operated there and whether there were any signs of imminent bankruptcy). And of course I got hold of the vehicle immediately after the transfer went through (which is guaranteed in a single business day nowadays; when I bought the first car it was still in the area of 2-3 days).

As for the $1000 TV, I would probably pay that at an electronic payment terminal with a debit card. If buying from a retailer, that's usually the way to go, no matter how small.

In many EU countries, you'd buy that tv using a debit card if at a physical retailer. Online, credit card purchases are the default.

Buying a used car form an individual might happen in cash. Some countries will not allow cash transactions over 3000€. So depending on the price, it might also happen with a SEPA transfer.

Most people would use a card for the TV, at least in person (online it’s very country dependent; probably card in the UK or Ireland, but could be SEPA, something like SOFORT or various other things in Germany, say). Not necessarily visa/mc; many countries have national networks, which are typically cobrandec with visa/mc.

Car could be SEPA (or equiv in non-Eurozone countries), bank draft, or even cash, though cheque is possibly less likely due to fraud concerns. Some people do it by actually physically going to a bank with the seller, I think (I don’t drive, so have never done his myself).

For in person stuff, where you live plays a role too; only a minority of countries currently have SEPA Instant, though that should change soon. For everyone else, it’s a day or so delay from when you send the payment in the bank app.

For larger transactions, ACH is becoming much more desireable. A bank I do business with currently offers originating next day ACH for $1 a transaction. When you add up the dollar cost of a stamp, check, and envelope, and the time expense of printing, mailing, and waiting for it to clear, ACH is highly affordable. I'm surprised taxing authorities still charge fees for getting paid faster when ACH is so cheap.

This might be a stupid question, but do you have to pay a fee for transferring money from one bank to another bank when both banks are located in the US?

Because the banks charge a fee (well, some of them do).

I know that sounds stupid but it's the truth. There is no law against banks charging fees like this, banks like to make money (don't we all!), and (significantly) banks don't seem to lose customers by charging these fees.

it doesn't cost anything but there is risk involved. So nobody takes a cut, but it also isn't "free". This is a fantastic series that explained it really well to me: https://engineering.gusto.com/how-ach-works-a-developer-pers...

In general: no. External transfers (ACH) and checks are generally free for within the US.

Also, compared to within the EU, ACH is incredibly slow. EU bank-to-bank transfer is instantaneous. ACH takes at least 1 day, often 2-3.