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India has done this for more than a decade at this point with IMPS and NEFT, and recently UPI. And I'm sure several other countries have them too, but for some

India has done this for more than a decade at this point with IMPS and NEFT, and recently UPI. And I'm sure several other countries have them too, but for some reason the US chooses to remain backwards in this case.

kelnos 3y ago
It's funny how so many non-Americans call our payments system "backwards", but I generally prefer it to bank-transfer-based payments: 1. When I pay with a credit card, I haven't actually spent any money. That money is still in my bank account, and I have the chance to dispute the transaction if it's fraudulent, without putting my own money on the line first. I've heard a few horror stories where a merchant/service has mis-charged a debit card or ACH transfer, and the time it took to get the money back caused stress around things like making rent payments. It frankly doesn't matter to me how common or uncommon such a thing is; it's literally impossible when paying for a credit card. (Yes, I do have to trust that the credit card issuer themselves won't make an error when debiting my bank account when the bill is due, but I prefer only having to trust one party not to make mistakes, than some larger number.) 2. While everyone is of course paying for this through higher prices in stores, I'm reasonably savvy about using credit cards that give me cash back or rewards points or something, and tailoring what card I use to benefit a particular transaction (for example, one card might give 3% back on grocery purchases, while another might give me 3x points on travel expenses). Ultimately I end up paying a bit less for everything than if I were to use cash or a debit card (or a bank transfer). Certainly some merchants have credit card surcharges, or discounts for paying cash/debit, but I find that those are a tiny percentage of my transactions, and I can always use cash or debit in those instances. It's hard to say how much (if at all) prices would actually be lower if credit cards (and their associated fees) didn't exist; handling cash isn't free either for businesses (counting/reconciliation, storage areas, security for transport to a bank, etc.). The main issue with our useless bank-transfer payments system is person-to-person payments. But these days, with Venmo, Cash App, and Zelle, that issue rarely comes up (and all of these are free for the sender if you use bank debit rather than a credit card). I can't remember the last time I had to give money to a friend that involved using cash. The big downside of all of these (similar to cash, I guess) is that there's very little fraud protection. If you send someone money, and they screw you over, you might not have much recourse. I very much consider our banking system backwards in many ways, but I find our payments system to be just fine, and, in some ways, quite good. And our banking system is backwards in part due to lack of demand.
- rootusrootus 3y ago
  I feel similarly. In these threads there are plenty of people to tell me how the US system sucks but then their examples are of things I’m glad we don’t do here. I’ve no problem moving money wherever I want, quickly, whether to a business or another person.
  - anaganisk 3y ago
    Good for you, but it's like saying, I rather travel by steam engine/someone else's car, while other countries are able to provide bullet trains. That how different payment methods in US vs few countries( I've only lived in the US and India, so I gave India as an example).
    - rootusrootus 3y ago
      I can pay anyone instantly, and get paid instantly. What am I missing?
      - anaganisk 3y ago
        Assuming you are using Zelle or Cash app or PayPal Those are run by 3rd party companies, that can absolutely keep/loose your money, and are a privacy liability, why I used some one else's car analogy. Or if you are using direct bank transfers, I've never once had a transaction that went thru from chase to any other in seconds, it literally took atleast 3 days.(steam engine analogy) Also if I input the data into any service, there is no authorization forever. Just my A/C number which could be leaked, and routing number which is easily obtainable info are enough, which is security liability. Fun part is even direct bank transfers take mere seconds to complete and are also authenticated and authorized via OTP. And UPI is not some random company, it's a common public interface between banks built by the govt. Every bank integrates into the system. Its well documented, and any app or infact anyone implement clients for it. It's authenticated for every transaction. And they do, we have 10s if not 100s of apps. And everything is real time(bullet train analogy) UPI has become so common in India that even in villages, shops, tuks tuks (autos as we call em), even beggars accept it. But in NYC, I barely could use Zelle. PayPal is never even accepted at an most shops. Cash app has better adoption as Zelle but then again not preferred form of payment, UPI is default form of transfer that is an actual cash replacement.
astrange 3y ago
The US has had multiple instant payment methods for years. Zelle is not the only one, debit cards are another.
- anaganisk 3y ago
  If you ever use UPI, your opinion will definitely change, the scale of payment transactions UPI handles in a day, and how much penetration it has. And how easy it is to setup or use. Like I mentioned in another comment, I am from India but have been living in US for last 2 years, so my comments are not from ignorance of US payment methods.
  - astrange 3y ago
    I'm not talking about person to person payment methods though. The existing ones we have are mostly used for daily payouts for eg Uber drivers.

kelnos 3y ago

It's funny how so many non-Americans call our payments system "backwards", but I generally prefer it to bank-transfer-based payments: 1. When I pay with a credit card, I haven't actually spent any money. That money is still in my bank account, and I have the chance to dispute the transaction if it's fraudulent, without putting my own money on the line first. I've heard a few horror stories where a merchant/service has mis-charged a debit card or ACH transfer, and the time it took to get the money back caused stress around things like making rent payments. It frankly doesn't matter to me how common or uncommon such a thing is; it's literally impossible when paying for a credit card. (Yes, I do have to trust that the credit card issuer themselves won't make an error when debiting my bank account when the bill is due, but I prefer only having to trust one party not to make mistakes, than some larger number.) 2. While everyone is of course paying for this through higher prices in stores, I'm reasonably savvy about using credit cards that give me cash back or rewards points or something, and tailoring what card I use to benefit a particular transaction (for example, one card might give 3% back on grocery purchases, while another might give me 3x points on travel expenses). Ultimately I end up paying a bit less for everything than if I were to use cash or a debit card (or a bank transfer). Certainly some merchants have credit card surcharges, or discounts for paying cash/debit, but I find that those are a tiny percentage of my transactions, and I can always use cash or debit in those instances. It's hard to say how much (if at all) prices would actually be lower if credit cards (and their associated fees) didn't exist; handling cash isn't free either for businesses (counting/reconciliation, storage areas, security for transport to a bank, etc.). The main issue with our useless bank-transfer payments system is person-to-person payments. But these days, with Venmo, Cash App, and Zelle, that issue rarely comes up (and all of these are free for the sender if you use bank debit rather than a credit card). I can't remember the last time I had to give money to a friend that involved using cash. The big downside of all of these (similar to cash, I guess) is that there's very little fraud protection. If you send someone money, and they screw you over, you might not have much recourse. I very much consider our banking system backwards in many ways, but I find our payments system to be just fine, and, in some ways, quite good. And our banking system is backwards in part due to lack of demand.

rootusrootus 3y ago
I feel similarly. In these threads there are plenty of people to tell me how the US system sucks but then their examples are of things I’m glad we don’t do here. I’ve no problem moving money wherever I want, quickly, whether to a business or another person.
- anaganisk 3y ago
  Good for you, but it's like saying, I rather travel by steam engine/someone else's car, while other countries are able to provide bullet trains. That how different payment methods in US vs few countries( I've only lived in the US and India, so I gave India as an example).
  - rootusrootus 3y ago
    I can pay anyone instantly, and get paid instantly. What am I missing?
    - anaganisk 3y ago
      Assuming you are using Zelle or Cash app or PayPal Those are run by 3rd party companies, that can absolutely keep/loose your money, and are a privacy liability, why I used some one else's car analogy. Or if you are using direct bank transfers, I've never once had a transaction that went thru from chase to any other in seconds, it literally took atleast 3 days.(steam engine analogy) Also if I input the data into any service, there is no authorization forever. Just my A/C number which could be leaked, and routing number which is easily obtainable info are enough, which is security liability. Fun part is even direct bank transfers take mere seconds to complete and are also authenticated and authorized via OTP. And UPI is not some random company, it's a common public interface between banks built by the govt. Every bank integrates into the system. Its well documented, and any app or infact anyone implement clients for it. It's authenticated for every transaction. And they do, we have 10s if not 100s of apps. And everything is real time(bullet train analogy) UPI has become so common in India that even in villages, shops, tuks tuks (autos as we call em), even beggars accept it. But in NYC, I barely could use Zelle. PayPal is never even accepted at an most shops. Cash app has better adoption as Zelle but then again not preferred form of payment, UPI is default form of transfer that is an actual cash replacement.

astrange 3y ago

The US has had multiple instant payment methods for years. Zelle is not the only one, debit cards are another.

anaganisk 3y ago
If you ever use UPI, your opinion will definitely change, the scale of payment transactions UPI handles in a day, and how much penetration it has. And how easy it is to setup or use. Like I mentioned in another comment, I am from India but have been living in US for last 2 years, so my comments are not from ignorance of US payment methods.
- astrange 3y ago
  I'm not talking about person to person payment methods though. The existing ones we have are mostly used for daily payouts for eg Uber drivers.