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I went to a few talks by the Coinbase team last year, and they talked a bit about why hard currency transfers can take so long. Basically, all ACH transfers wo

I went to a few talks by the Coinbase team last year, and they talked a bit about why hard currency transfers can take so long. Basically, all ACH transfers work via a FTP system. Your bank uploads a transactions file at the end of the day. That transaction file is then sent to a server that then connects to a central bank. The next day, that central bank does an FTP transfer to the other bank's system, balancing out the transfer. This process can take 3-5 business days. But, once the money has been "transferred", it can still be rolled back for up to 90 days after the transaction has happened. This makes it really difficult to say when you've "received" the money for real. It gets extra scary when the money on one side can't be rolled back at all (ie the cryptocurrency). I'm sure at the scale Coinbase is working at, they're running into terrifying numbers, and want to stay as covered as possible. The customers don't really understand the time scales of traditional banking, and here we are. The interface between the two makes for some "interesting" edge cases.

hyder_m29 9y ago
Here's a neat set of 4-part article explaining the workings of ACH from a developer's perspective. https://engineering.gusto.com/how-ach-works-a-developer-perspective-part-1/ https://engineering.gusto.com/how-ach-works-a-developer-pers...
tinokid 9y ago
For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". Anyone claiming there are large inherent delays in that setup is full of baloney. Yes there are some dispute/reversal windows that I have never had experience with, but if you are just transferring money between your own accounts this should not be a serious issue.
- segmondy 9y ago
  Typically takes a day but you forgot that there are very small banks. How long it takes to show up in your account has nothing to do with how fast the Feds transferred it to the receiving bank but how automated and fast the receiving bank deposits it in your account. There are also times when it takes longer, weekends and bank holidays can extend that time
- matwood 9y ago
  > For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". Anyone claiming there are large inherent delays in that setup is full of baloney. I believe in this case your bank 'trusts' you. With banks that I have an existing relationship with I can move money overnight. When I open an account at a new bank it takes days for the money to be available for use. Presumably the new bank does not trust me yet, and thus makes me wait for all of the confirmations to occur.
- jsjohnst 9y ago
  > For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". You are mistaking ACH for wire transfer (or are not aware of the good faith credit your bank provides). There’s three main ways to send money between accounts: - wire transfer with immediate delivery - wire transfer with next day delivery (likely what you are mistakenly thinking is ACH) - ACH which takes the previously mentioned several days (for making sure there isn’t a return for reasons other than stolen account). ACH is essentially “writing a check, sans paper”. The first two are essentially direct bank-bank transfers. The latter goes through a clearing house as described and has a clumsy (in modern terms) process with lots of unneeded delays. Banks will many times credit the money to your account much faster, but they do that for two reasons. - they have an existing relationship with you and know your risk profile - they sometimes also send an electronic request to the other bank confirming fund availability. Not all banks support this, but when they do, generally banks will overlook some extra risk from the previous bullet (as in, you don’t have available funds to claw back). Happy to provide much more technical details if you insist, but Google could trivially do that for you. > Anyone claiming there are large inherent delays in that setup is full of baloney. No need to be derogatory towards others stating facts to you.
  - tinokid 9y ago
    No, I am not mistaking ACH for wire transfer, or any kind of "credit" system. If your bank is taking longer it's because your bank sucks. But yes please provide those "technical details" whenever you have a chance. https://www.frbservices.org/assets/financial-services/ach/091517-same-day-schedule.pdf https://www.frbservices.org/assets/financial-services/ach/09...
    - ad_hominem 9y ago
      "... the ACH system never provides positive confirmation that an ACH debit has gone through successfully. The only response an ACH originator may get is one notifying them of a return. Because of this 'no news is good news' policy, it is wise for originators of ACH debits to wait for 3 additional business days of 'no news' to ship their product to the customer. Though the ACH system is described as a next-day settlement system, in practice, it is not because of this."[1] So your bank is being optimistic and giving you a credit, assuming that no return will happen. A pessimistic or cautious bank would really have to wait several business days to ensure no returns happen before crediting your account. [1]: https://engineering.gusto.com/how-ach-works-a-developer-perspective-part-3/ https://engineering.gusto.com/how-ach-works-a-developer-pers...
- astura 9y ago
  https://ptmoney.com/why-do-online-bank-transfers-take-so-freakin-long/ https://ptmoney.com/why-do-online-bank-transfers-take-so-fre... The WSJ linked is paywalled but the quotes are “…these large transfers move in steps. Banks have slowed down the process further to reduce the chance of fraud… [the bank] sends transactions in batches during the day to an automated clearinghouse, which sorts them and moves them to the receiving bank in a matter of two to four hours… In many cases, the receiving bank gets the transfer the same day." So delays are inserted on purpose. Certain banks don't introduce these delays, or have minimum delays, you'll know it when you're using one. USAA and Fidelity are two I've used that don't delay ACH transfers, those have always cleared ACH transfers next day. I even get my paycheck a day early when deposited into one of those accounts. The other option is your bank keeps a tab of "transfers that are trusted."
  - jsjohnst 9y ago
    > USAA and Fidelity are two I've used that don't delay ACH transfers, those have always cleared ACH transfers next day. This is because they are crediting you the money before they actually have it confirmed. See my reply below to GP, they are doing this because they are more risk tolerant and/or you are a less risky customer.
segmondy 9y ago
Good info but ACH rejects can be up to 180 days
- burningion 9y ago
  Thanks! Can't edit my comment anymore.

hyder_m29 9y ago

Here's a neat set of 4-part article explaining the workings of ACH from a developer's perspective. https://engineering.gusto.com/how-ach-works-a-developer-perspective-part-1/ https://engineering.gusto.com/how-ach-works-a-developer-pers...

tinokid 9y ago

For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". Anyone claiming there are large inherent delays in that setup is full of baloney. Yes there are some dispute/reversal windows that I have never had experience with, but if you are just transferring money between your own accounts this should not be a serious issue.

segmondy 9y ago
Typically takes a day but you forgot that there are very small banks. How long it takes to show up in your account has nothing to do with how fast the Feds transferred it to the receiving bank but how automated and fast the receiving bank deposits it in your account. There are also times when it takes longer, weekends and bank holidays can extend that time
matwood 9y ago
> For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". Anyone claiming there are large inherent delays in that setup is full of baloney. I believe in this case your bank 'trusts' you. With banks that I have an existing relationship with I can move money overnight. When I open an account at a new bank it takes days for the money to be available for use. Presumably the new bank does not trust me yet, and thus makes me wait for all of the confirmations to occur.
jsjohnst 9y ago
> For ten years I've been able to place a ACH transfer at one bank by 6 pm and have it available in my other bank by 8 am the following morning. It has never taken "3-5 business days". You are mistaking ACH for wire transfer (or are not aware of the good faith credit your bank provides). There’s three main ways to send money between accounts: - wire transfer with immediate delivery - wire transfer with next day delivery (likely what you are mistakenly thinking is ACH) - ACH which takes the previously mentioned several days (for making sure there isn’t a return for reasons other than stolen account). ACH is essentially “writing a check, sans paper”. The first two are essentially direct bank-bank transfers. The latter goes through a clearing house as described and has a clumsy (in modern terms) process with lots of unneeded delays. Banks will many times credit the money to your account much faster, but they do that for two reasons. - they have an existing relationship with you and know your risk profile - they sometimes also send an electronic request to the other bank confirming fund availability. Not all banks support this, but when they do, generally banks will overlook some extra risk from the previous bullet (as in, you don’t have available funds to claw back). Happy to provide much more technical details if you insist, but Google could trivially do that for you. > Anyone claiming there are large inherent delays in that setup is full of baloney. No need to be derogatory towards others stating facts to you.
- tinokid 9y ago
  No, I am not mistaking ACH for wire transfer, or any kind of "credit" system. If your bank is taking longer it's because your bank sucks. But yes please provide those "technical details" whenever you have a chance. https://www.frbservices.org/assets/financial-services/ach/091517-same-day-schedule.pdf https://www.frbservices.org/assets/financial-services/ach/09...
  - ad_hominem 9y ago
    "... the ACH system never provides positive confirmation that an ACH debit has gone through successfully. The only response an ACH originator may get is one notifying them of a return. Because of this 'no news is good news' policy, it is wise for originators of ACH debits to wait for 3 additional business days of 'no news' to ship their product to the customer. Though the ACH system is described as a next-day settlement system, in practice, it is not because of this."[1] So your bank is being optimistic and giving you a credit, assuming that no return will happen. A pessimistic or cautious bank would really have to wait several business days to ensure no returns happen before crediting your account. [1]: https://engineering.gusto.com/how-ach-works-a-developer-perspective-part-3/ https://engineering.gusto.com/how-ach-works-a-developer-pers...
astura 9y ago
https://ptmoney.com/why-do-online-bank-transfers-take-so-freakin-long/ https://ptmoney.com/why-do-online-bank-transfers-take-so-fre... The WSJ linked is paywalled but the quotes are “…these large transfers move in steps. Banks have slowed down the process further to reduce the chance of fraud… [the bank] sends transactions in batches during the day to an automated clearinghouse, which sorts them and moves them to the receiving bank in a matter of two to four hours… In many cases, the receiving bank gets the transfer the same day." So delays are inserted on purpose. Certain banks don't introduce these delays, or have minimum delays, you'll know it when you're using one. USAA and Fidelity are two I've used that don't delay ACH transfers, those have always cleared ACH transfers next day. I even get my paycheck a day early when deposited into one of those accounts. The other option is your bank keeps a tab of "transfers that are trusted."
- jsjohnst 9y ago
  > USAA and Fidelity are two I've used that don't delay ACH transfers, those have always cleared ACH transfers next day. This is because they are crediting you the money before they actually have it confirmed. See my reply below to GP, they are doing this because they are more risk tolerant and/or you are a less risky customer.

segmondy 9y ago

Good info but ACH rejects can be up to 180 days

burningion 9y ago
Thanks! Can't edit my comment anymore.