> In the US, it takes 24 business hours to transfer money, sometimes less.
What? The third-world banking system of the US often takes MUCH longer than that.
No. Checks clear in 24 business hours, and fedwire wire transfers work same day if they are submitted early enough, and in no case more than 24 business hours (for domestic wires). Oftentimes domestic fedwire transfers are nearly real-time, and there is a plan for further modernization to speed things up in more cases.
ACH transfers are also 24 business hours.
The check clearing thing is called Check 21 and it was a big thing back in 2004 when it went into effect.
https://www.federalreserve.gov/paymentsystems/regcc-faq-chec...
Additionally, there is at least one person at the company whose full-time job is to handle this. Making a transfer every Tuesday or Wednesday or whatever is well within a workload. When I say "sitting in checking" I quite obviously mean more than two weeks by "sitting".
Also, I was mostly referring to series-A startups that have, for example, single digit millions in the bank. Keeping that all in checking is dumb. Larger companies that are moving millions each week can afford to have special arrangements with their bank or banks to limit liability independent of FDIC. A line of credit, perhaps, that is paid off a week or three later, secured by a bundle of securities held at the same institution, for example. I'm fairly sure a bank run can't touch those.
There are so many possible solutions to this problem.
Maybe it's because I've been burned hard by banks before, but I'll never trust them to not do precisely what SVB did here (in some fashion). Everything's great until it isn't.