[dqv]

It's interesting to see this discussion about speeding up check processing, because it seems that a lot of people use checks to slow payments down. It's a convenient way to make it inconvenient for the receiving party!

It works like this: receive invoice, wait until due date, write a check dated for the due date, wait a few days, send it through regular mail, and complain about the past due notices because "I've already sent the payment!! Did you lose it or something?" Applying late fees doesn't work either, they'll just send a late payment again without the late fee included.

At first, I genuinely thought it was because they preferred checks for record keeping purposes, but when I set up echeck and told them how they just need to call us and give us the check number to pay. Or they can just enter their information at our payment processor's portal. Nope! It's "insecure" (Sir/Madam, you're sending me a piece of paper with your bank account and routing number and it's going through the mailing system where mail gets lost...). For that same reason, they don't want to pay with a card either.

That's why the cost of paying the transaction fees for card processing is so worth it to me. I got the check scanner years before the COVID lockdowns to speed things up, but nothing beats the sometimes instant card settlement deposits. I still accept checks from responsible, timely payors, but stop doing business with anyone who has a pattern of paying late with checks. It's not worth the additional work to get them to pay (there's truly no way to know what their intent is - are their lateness predictable or is this the month they're going to wait 45 days to pay?). I'm fine with letting someone else wait for them to pay late.

One thing that still seems to be missing from bank cards is the lack of ability to add your own identifier (namely the check number) to the transaction at time of payment. I understand that, for responsible payors, this is why they might prefer paying with checks - you not only get a reference number, a memo line, and a date that makes sense for your own internal system. Even with bank cards, the date of the transaction is sometimes not the date that it actually happened, which can be confusing for record association. Zelle has a memo entry, but the reference identifiers are letters and numbers, ew. An internal auto incrementing number to identify transactions would be really useful.

Anyway, hopefully paper checks will be phased out. Although I do still find them useful for interbank account transfers - the Zelle multi-account trick still makes me kind of queasy.

[Arrath]

> It works like this: receive invoice, wait until due date, write a check dated for the due date, wait a few days, send it through regular mail, and complain about the past due notices because "I've already sent the payment!! Did you lose it or something?" Applying late fees doesn't work either, they'll just send a late payment again without the late fee included.

This certainly seems to be the standard accounting practice at most contractor's I've worked for. Including choice tidbits like "We know the due date was Thursday, but the only person our JV agreement allows to sign checks is out until next Tuesday, so your check will be on that run."

[lxgr]

If you prefer the user experience of cards over that of checks, imagine a world in which you can transfer money to anybody with a bank account by telling your bank to make a payment to their account number!

That's been the reality in many countries other than the US for decades :) And maybe (hopefully!), the US will finally catch up with FedNow.

Of course that model doesn't work for everything (it's usually a bad idea to pre-pay for goods or services with bank transfers since there is essentially no consumer protection in case the merchant goes bankrupt or turns out to be a fraudster), but I'm still fascinated by the US's lack of a "giro" system, i.e. an accountholder-initiated P2P and B2C push payment service.

[toast0]

> Of course that model doesn't work for everything (it's usually a bad idea to pre-pay for goods or services with bank transfers since there is essentially no consumer protection in case the merchant goes bankrupt or turns out to be a fraudster), but I'm still fascinated by the US's lack of a "giro" system, i.e. an accountholder-initiated P2P and B2C push payment service.

We have wire transfers which work like this, through the FedWire system. They're instant, can't easily be reversed, and usually expensive and inconvenient to use.

[lxgr]

Wires are not a mass payments system by any means, though.

The equivalent to SEPA credit and debit transfers would be ACH, just that in the US, it is generally not possible for individual/private account holders to initiate outbound ACH credit transfers.

FedNow might be just that, but I’m not sure yet US bank customers will become comfortable with sharing their account number freely in order to receive P2P payments that easily.

[hakfoo]

With cards, merchants can theoretically pass additional data to identify a purchase order number, or even distinct line items (30 red widgets at $6.34 each), but it's only offered for corporate cards.

I'm surprised there's no way to opt-in as a consumer, or that some middleman doesn't want to really push it to gain more data to mine.

I think on a practical basis, though, it's flagged by the BIN (the first 6 or 8 digits of the card number)-- if it's not in a known commercial-card range, the data might not get sent upstream, so random users turning it on wouldn't work.

[muffinman26]

I always make sure my checks arrive before their due date, but yes, I think mail is more secure than whatever random payment processor portal a company decides to set up. There's no way I trust the e-pay system of my Home Owner's Association, for example, which looks to be custom for absolutely no reason and frequently crashes. I have yet to lose a single check in the mail after sending 3-4 a month for the last 5+ years.