7 ms·

It amazes me everytime, that in the US day-to-day banking still consists mostly of writing, sending and cashing cheques. In germany (I dont know about the rest

by derda 14y ago

It amazes me everytime, that in the US day-to-day banking still consists mostly of writing, sending and cashing cheques. In germany (I dont know about the rest of Europe, but I guess the situation is similar), cheques are virtually non existent. You can still get and cash them, but you will get weird looks from the person behind the bank counter, most of the time there will be a hefty fee associated with it(I once cashed a cheque from an US-bases affiliate program and my bank charged me a ridiculous amount for the process).

veyron 14y ago
Checks are still useful because most online transfer mechanisms cost money. For example, my bank recently started charging for ACH transfers, and wires are always expensive.
- theorique 14y ago
  Yeah, exactly. I was going to try some new method (PopMoney?) to pay my roommate for rent and utilities, and then I noticed it cost $1 per transaction. Back to paper checks (= free). It's not the fact that it costs something - a dollar is no big deal - it's the fact that the alternative is free.
  - epscylonb 14y ago
    This is the big problem with acquiring bitcoin right now, of course once you have it, transactions are very cheap.
  - uxp 14y ago
    I have this problem with paying for Utilities in the States. Both my Electric and Internet allow for auto-pay against my checking account without a fee, but my Natural Gas company uses Western Union for their payment processing, which charge somewhere between a dollar or two per payment as a fee. The cost of a stamp and the free non-personalized checks from my bank end up being cheaper than paying Western Union every month for the "convenience" of online/electronic payments. My landlord also lives out of state and is an individual, not a large company, so I send her a check every month by snail mail. You're right, the actual dollar is no big deal, but I continually write their annual survey with remarks about how my Gas Company's online bill pay sucks. I'd rather not pay fee upon fee to do business with a company that feels the need to continually lobby the government for the right to add more fees. Everyone else gets by without having to charge extra for 21st century banking methods.
  - cdcarter 14y ago
    Does your bank offer an online bill-pay system? Mine does for free, and if they can't deliver the money electronically they cut and mail a check for you.
    - theorique 14y ago
      The banks I use do offer this. I call it "electronic on at least one side" because it appears like an electronic payment for me, even if it's old-school on the other end. It works fine for the "paying utility" case (or "mailing combined rent check"), but it feels kind of silly when it's for transferring money to my roommate who lives 20 feet away.
- kolinko 14y ago
  The question is - why are online transfer mechanisms expensive? Wire transfers should be much cheaper than checkques. In Poland (although we're a much smaller country), wire transfers cost from free to 30 cents (doesn't matter how much you send, you could wire $1M and still pay 30 cents), and take from an hour to a working day to process.
  - veyron 14y ago
    Wire transfer and CHIPs both go through the NY Fed system. The banks send requests and money is drawn from or credited to the individual bank's account at the fed. Here are the specs: http://www.frbservices.org/campaigns/remittance/files/fedwire_funds_format_reference_guide.pdf http://www.frbservices.org/campaigns/remittance/files/fedwir...
- k33l0r 14y ago
  In Finland cheques are pretty much completely unused. Domestic bank transfers are pretty much free for all private people and almost everyone pays all their invoices electronically via their online bank. To transfer money from person to person, the only information you need is their bank account number and name. As far I can tell, there's no way that you could use the account number in a malicious way (which is why charities and companies can publish their's with no repercussions). With the introduction of SEPA and IBANs, this now applies to the entire EU. What's more, credit and debit cards are accepted almost universally (with a few exceptions), which means that I hardly ever carry cash with me. I think you can get a cashier’s cheque if you really need to, but I think cheque books have completely disappeared (I don't even know if I could get one if I really wanted to).
  - veyron 14y ago
    " Domestic bank transfers are pretty much free for all private people and almost everyone pays all their invoices electronically via their online bank." In the US, domestic bank transfers cost money (for example, Bank of America charges 3 dollars for ACH and 25 for sending wires; most banks charge 15 for receiving a wire), which explains to a great extent why cheques are still used. "What's more, credit and debit cards are accepted almost universally" -- credit card fees are onerous "I think you can get a cashier’s cheque if you really need to" -- did that on Friday. 8 bucks.
    - mrweasel 14y ago
      Credit card fees aren't onerous, not here in Denmark at least, I think Finland has a similar deal. Credit cards are issued by your bank, you pay one yearly fee, 175DKK around 30USD. More often than not the bank will give you a VISA debit card for free, or a Master Card with 30.000DKK limit, no interest if you pay the debt of each month (The bank will do the transfer from your account for free, assuming that you have the money of cause). Paying bills online: Free Domestic bank transfer: Free Credit card / debit card: Free or fixed fee Getting a check made out: Pretty expensive
      - veyron 14y ago
- adrianmsmith 14y ago
  It's a law or rule somewhere, that if you do electronic transfers between Euro countries (i.e. a good portion of the EU, and thus certainly within one Euro country) it has to be free. So checks don't offer that advantage here in Euro-Europe.
- ansgri 14y ago
  Can't you use cash? I honestly can't understand most of the comments as it seems here in Russia there's no concept of a check, or at least no 'real person' ever used anything like that.
  - duaneb 14y ago
    Sure, but then someone can mug you. Credit cards and checks you can cancel.
- stephen_g 14y ago
  That's interesting, because it's the opposite in Australia. I would have to pay a fee to get a chequebook (I'm not sure if it's per-annum or per book, probably depends on banks) but on my accounts I have unlimited free transfers to any bank in Australia. Pretty much all personal accounts here get that - some business accounts still have to pay a few cents per transfer, but free online transfers are becoming a lot more common for those. I also have a free EFTPOS (Maestro/Cirrus) and Visa Debit card, and can pay bills at no extra cost using the BPAY system from my online banking, so I never write cheques at all...
  - jacques_chester 14y ago
    While it's true that the personal cheque account is 100 kinds of dead, they're still used for some businesses. Especially if they're cash-y. In particular they tend to be used for small businesses, associations and the like because they won't have proper accounting systems set up to track transactions. The cheque stubs form a useful source document for book keepers, accountants and auditors. Also, a chequeing account can have a requirement for multiple signatures. This matters a lot for partnership-style businesses and of course incorporated and unincorporated associations. Indeed most model constitutions for incorporated associations specifically mention the chequebook, who possesses it and who must sign cheques. Even so, it's dying out there too. Bank statements have gotten progressively more descriptive as time goes on. Plus the banks are grasping thieving mongrels who use "but it's paper" as an excuse to slug you for stunning fees for every node in the state chart of cheque deposits. I have cheque books and deposit books for my Pty Ltd accounts and I have never had occasion to use them. I pay bills with the corporate credit card and since I deal with large creditors they prefer to convenience and reliability of direct deposits.
  - jeza 14y ago
    The Commonwealth Bank tried charging for online transfers about six years ago. It caused such a public uproar that they made them free again. I suspect that it was a bait and switch attempt to phase out branch banking. I.e. make it free until everyone switches over then start charging fees. But it backfired.
johnchristopher 14y ago
In Belgium as well. But when parents decided to sell my grand-parents' house located in France I heard a lot of cursing about the antiquated french cheque system and the administration being obsessed with it.
stinkytaco 14y ago
I have not used a check for several years, nor has anyone I know. My bank gets a deposit from my job and I use a bank card to withdraw cash or a credit card to make purchases (the credit card is paid everymonth with an automatic bank draft). I think that's pretty standard unless you're a small business or require some sort of paper trail.
deleted 14y ago
[deleted]
sausagefeet 14y ago
Checks are unheard of in Sweden at this point too. What is really annoying is I still do some consulting in the US and for some reason a lot of places will only pay a consultant with a paper check. Absolutely ridiculous. They have to mail the check across an ocean just for me to take a picture of it and deposit it back in the States.
takluyver 14y ago
In the UK, as in so many things, we're half way between Europe and the US. Cheques (spelled like that) are rarely used, but most people have a cheque book in a drawer somewhere. Bank transfers here are free, but the recipient has to give you their account number & sort code, so you might use a cheque to give money to a friend. Private landlords might require the rent as postdated cheques. If you send a membership form by post, you might be able to enclose a cheque to pay for it, though it's more common to set up a direct debit.
- ABS 14y ago
  > Cheques (spelled like that) are rarely used looking at all the people protesting the proposed removal of cheques in UK last year I'd say that's not the case :-) Sadly many (relatively) big business and countless public bodies only pay and accepts payment by cheques. As an example only this year City of London Corp started accepting bank transfers for rent deposit. 2 years ago I had to dig up my business cheque book and bring a cheque to their offices for an office rent deposit. Take a look at the "Treasury - Written Evidence - The end of Cheques?" http://www.publications.parliament.uk/pa/cm200910/cmselect/cmtreasy/477/477we01.htm http://www.publications.parliament.uk/pa/cm200910/cmselect/c...
frogpelt 14y ago
I'm not sure that it is as much this way anymore. You are required to have direct deposit where I work and I only write checks to individuals or to businesses that don't accept debit/credit card transactions. This story took place in 1995. Some things have changed in the last 17 years.
gst 14y ago
The Zahlschein that is still very common in Germany isn't really any more modern than a check.
duaneb 14y ago
It's free, personal money transfer that you can cancel if someone steals. What's not to like?
- jarek 14y ago
  The multiple-day clearing process? The need to transfer a physical item to transfer a couple of numbers?
  - duaneb 14y ago
    Do you have a better solution? Also, many banks now allow cashing photos of checks.
    - jarek 14y ago
      > Do you have a better solution? I don't personally, but there's lots of accounts in these comments about systems in other countries that have free or nearly free near-instant wire transfers provided bank account number and name. Charities soliciting donations include their account number in ads. If you don't have a bank account you can make a deposit into the account at the post office. It doesn't get much simpler. > Also, many banks now allow cashing photos of checks. Yeah, but until you can "sign" an image of a cheque and email it to the recipient - and I'm not sure if that'd be technically a valid legal cheque in the U.S. - a physical copy must exist at some point.
      - duaneb 14y ago
        > I don't personally, but there's lots of accounts in these comments about systems in other countries that have free or nearly free near-instant wire transfers provided bank account number and name. Charities soliciting donations include their account number in ads. This is currently expensive with american banks because use of checks is so wide spread - that might work. > If you don't have a bank account you can make a deposit into the account at the post office. It doesn't get much simpler. I guess.... and yet, I prefer checks for A) having something physical to document, B) being able to give people non-cash physical money. I guess something like a cashiers check would also serve this purpose, and C) avoid using online banking software, which is atrocious. I can't use more than 10 characters per password, and my default one is 26 characters. I don't trust billion dollar companies with securing my banking information. If people want to take my money, they'll have to make an effort and go through my trash.
greggman 14y ago
Checks don't exist in Japan for the most part either. On the other hand, rent in Japan is usually paid by bank transfer at $6 per transaction (done at the ATM or online). Checks, in the USA, are free, no transaction fee
josteink 14y ago
I remember asking my bank about "travel checks" because I read online that this was the best way to pay when abroad. They just looked at me like I was mad and said "nobody uses those any more. Just use your bank card and withdraw cash in ATMs as needed". They literally told me that nobody (as in "no banks", locally) did checks anymore and that they could not be issued even if I wanted them. This was 10 years ago. So yeah. US banking is stone age. And at the same time the US is the world leader in electronic, financial trading with millisecond-trading (microsecond-trading?) being the norm among the big trading companies. It really doesn't make much sense.
goostavos 14y ago
Many places in the US charge ridiculous "Convenience" charges to pay with a credit card. I pay my rent with a check. Why? Because they charge me almost $40 for the "convenience" of using my MasterCard. Same thing when I had my car loan. $15 convenience charge to pay online with a credit card. It's complete crap, and a total racket. Unless I want to pay >$50 month for the luxury of paying my bills in any modern way, I'm back to writing checks.

by derda 14y ago

veyron 14y ago

Checks are still useful because most online transfer mechanisms cost money. For example, my bank recently started charging for ACH transfers, and wires are always expensive.

theorique 14y ago
Yeah, exactly. I was going to try some new method (PopMoney?) to pay my roommate for rent and utilities, and then I noticed it cost $1 per transaction. Back to paper checks (= free). It's not the fact that it costs something - a dollar is no big deal - it's the fact that the alternative is free.
- epscylonb 14y ago
  This is the big problem with acquiring bitcoin right now, of course once you have it, transactions are very cheap.
- uxp 14y ago
  I have this problem with paying for Utilities in the States. Both my Electric and Internet allow for auto-pay against my checking account without a fee, but my Natural Gas company uses Western Union for their payment processing, which charge somewhere between a dollar or two per payment as a fee. The cost of a stamp and the free non-personalized checks from my bank end up being cheaper than paying Western Union every month for the "convenience" of online/electronic payments. My landlord also lives out of state and is an individual, not a large company, so I send her a check every month by snail mail. You're right, the actual dollar is no big deal, but I continually write their annual survey with remarks about how my Gas Company's online bill pay sucks. I'd rather not pay fee upon fee to do business with a company that feels the need to continually lobby the government for the right to add more fees. Everyone else gets by without having to charge extra for 21st century banking methods.
- cdcarter 14y ago
  Does your bank offer an online bill-pay system? Mine does for free, and if they can't deliver the money electronically they cut and mail a check for you.
  - theorique 14y ago
    The banks I use do offer this. I call it "electronic on at least one side" because it appears like an electronic payment for me, even if it's old-school on the other end. It works fine for the "paying utility" case (or "mailing combined rent check"), but it feels kind of silly when it's for transferring money to my roommate who lives 20 feet away.
kolinko 14y ago
The question is - why are online transfer mechanisms expensive? Wire transfers should be much cheaper than checkques. In Poland (although we're a much smaller country), wire transfers cost from free to 30 cents (doesn't matter how much you send, you could wire $1M and still pay 30 cents), and take from an hour to a working day to process.
- veyron 14y ago
  Wire transfer and CHIPs both go through the NY Fed system. The banks send requests and money is drawn from or credited to the individual bank's account at the fed. Here are the specs: http://www.frbservices.org/campaigns/remittance/files/fedwire_funds_format_reference_guide.pdf http://www.frbservices.org/campaigns/remittance/files/fedwir...
k33l0r 14y ago
In Finland cheques are pretty much completely unused. Domestic bank transfers are pretty much free for all private people and almost everyone pays all their invoices electronically via their online bank. To transfer money from person to person, the only information you need is their bank account number and name. As far I can tell, there's no way that you could use the account number in a malicious way (which is why charities and companies can publish their's with no repercussions). With the introduction of SEPA and IBANs, this now applies to the entire EU. What's more, credit and debit cards are accepted almost universally (with a few exceptions), which means that I hardly ever carry cash with me. I think you can get a cashier’s cheque if you really need to, but I think cheque books have completely disappeared (I don't even know if I could get one if I really wanted to).
- veyron 14y ago
  " Domestic bank transfers are pretty much free for all private people and almost everyone pays all their invoices electronically via their online bank." In the US, domestic bank transfers cost money (for example, Bank of America charges 3 dollars for ACH and 25 for sending wires; most banks charge 15 for receiving a wire), which explains to a great extent why cheques are still used. "What's more, credit and debit cards are accepted almost universally" -- credit card fees are onerous "I think you can get a cashier’s cheque if you really need to" -- did that on Friday. 8 bucks.
  - mrweasel 14y ago
    Credit card fees aren't onerous, not here in Denmark at least, I think Finland has a similar deal. Credit cards are issued by your bank, you pay one yearly fee, 175DKK around 30USD. More often than not the bank will give you a VISA debit card for free, or a Master Card with 30.000DKK limit, no interest if you pay the debt of each month (The bank will do the transfer from your account for free, assuming that you have the money of cause). Paying bills online: Free Domestic bank transfer: Free Credit card / debit card: Free or fixed fee Getting a check made out: Pretty expensive
    - veyron 14y ago
adrianmsmith 14y ago
It's a law or rule somewhere, that if you do electronic transfers between Euro countries (i.e. a good portion of the EU, and thus certainly within one Euro country) it has to be free. So checks don't offer that advantage here in Euro-Europe.
ansgri 14y ago
Can't you use cash? I honestly can't understand most of the comments as it seems here in Russia there's no concept of a check, or at least no 'real person' ever used anything like that.
- duaneb 14y ago
  Sure, but then someone can mug you. Credit cards and checks you can cancel.
stephen_g 14y ago
That's interesting, because it's the opposite in Australia. I would have to pay a fee to get a chequebook (I'm not sure if it's per-annum or per book, probably depends on banks) but on my accounts I have unlimited free transfers to any bank in Australia. Pretty much all personal accounts here get that - some business accounts still have to pay a few cents per transfer, but free online transfers are becoming a lot more common for those. I also have a free EFTPOS (Maestro/Cirrus) and Visa Debit card, and can pay bills at no extra cost using the BPAY system from my online banking, so I never write cheques at all...
- jacques_chester 14y ago
  While it's true that the personal cheque account is 100 kinds of dead, they're still used for some businesses. Especially if they're cash-y. In particular they tend to be used for small businesses, associations and the like because they won't have proper accounting systems set up to track transactions. The cheque stubs form a useful source document for book keepers, accountants and auditors. Also, a chequeing account can have a requirement for multiple signatures. This matters a lot for partnership-style businesses and of course incorporated and unincorporated associations. Indeed most model constitutions for incorporated associations specifically mention the chequebook, who possesses it and who must sign cheques. Even so, it's dying out there too. Bank statements have gotten progressively more descriptive as time goes on. Plus the banks are grasping thieving mongrels who use "but it's paper" as an excuse to slug you for stunning fees for every node in the state chart of cheque deposits. I have cheque books and deposit books for my Pty Ltd accounts and I have never had occasion to use them. I pay bills with the corporate credit card and since I deal with large creditors they prefer to convenience and reliability of direct deposits.
- jeza 14y ago
  The Commonwealth Bank tried charging for online transfers about six years ago. It caused such a public uproar that they made them free again. I suspect that it was a bait and switch attempt to phase out branch banking. I.e. make it free until everyone switches over then start charging fees. But it backfired.

johnchristopher 14y ago

In Belgium as well. But when parents decided to sell my grand-parents' house located in France I heard a lot of cursing about the antiquated french cheque system and the administration being obsessed with it.

stinkytaco 14y ago

I have not used a check for several years, nor has anyone I know. My bank gets a deposit from my job and I use a bank card to withdraw cash or a credit card to make purchases (the credit card is paid everymonth with an automatic bank draft). I think that's pretty standard unless you're a small business or require some sort of paper trail.

deleted 14y ago

[deleted]

sausagefeet 14y ago

Checks are unheard of in Sweden at this point too. What is really annoying is I still do some consulting in the US and for some reason a lot of places will only pay a consultant with a paper check. Absolutely ridiculous. They have to mail the check across an ocean just for me to take a picture of it and deposit it back in the States.

takluyver 14y ago

In the UK, as in so many things, we're half way between Europe and the US. Cheques (spelled like that) are rarely used, but most people have a cheque book in a drawer somewhere. Bank transfers here are free, but the recipient has to give you their account number & sort code, so you might use a cheque to give money to a friend. Private landlords might require the rent as postdated cheques. If you send a membership form by post, you might be able to enclose a cheque to pay for it, though it's more common to set up a direct debit.

ABS 14y ago
> Cheques (spelled like that) are rarely used looking at all the people protesting the proposed removal of cheques in UK last year I'd say that's not the case :-) Sadly many (relatively) big business and countless public bodies only pay and accepts payment by cheques. As an example only this year City of London Corp started accepting bank transfers for rent deposit. 2 years ago I had to dig up my business cheque book and bring a cheque to their offices for an office rent deposit. Take a look at the "Treasury - Written Evidence - The end of Cheques?" http://www.publications.parliament.uk/pa/cm200910/cmselect/cmtreasy/477/477we01.htm http://www.publications.parliament.uk/pa/cm200910/cmselect/c...

frogpelt 14y ago

I'm not sure that it is as much this way anymore. You are required to have direct deposit where I work and I only write checks to individuals or to businesses that don't accept debit/credit card transactions. This story took place in 1995. Some things have changed in the last 17 years.

gst 14y ago

The Zahlschein that is still very common in Germany isn't really any more modern than a check.

duaneb 14y ago

It's free, personal money transfer that you can cancel if someone steals. What's not to like?

jarek 14y ago
The multiple-day clearing process? The need to transfer a physical item to transfer a couple of numbers?
- duaneb 14y ago
  Do you have a better solution? Also, many banks now allow cashing photos of checks.
  - jarek 14y ago
    > Do you have a better solution? I don't personally, but there's lots of accounts in these comments about systems in other countries that have free or nearly free near-instant wire transfers provided bank account number and name. Charities soliciting donations include their account number in ads. If you don't have a bank account you can make a deposit into the account at the post office. It doesn't get much simpler. > Also, many banks now allow cashing photos of checks. Yeah, but until you can "sign" an image of a cheque and email it to the recipient - and I'm not sure if that'd be technically a valid legal cheque in the U.S. - a physical copy must exist at some point.
    - duaneb 14y ago
      > I don't personally, but there's lots of accounts in these comments about systems in other countries that have free or nearly free near-instant wire transfers provided bank account number and name. Charities soliciting donations include their account number in ads. This is currently expensive with american banks because use of checks is so wide spread - that might work. > If you don't have a bank account you can make a deposit into the account at the post office. It doesn't get much simpler. I guess.... and yet, I prefer checks for A) having something physical to document, B) being able to give people non-cash physical money. I guess something like a cashiers check would also serve this purpose, and C) avoid using online banking software, which is atrocious. I can't use more than 10 characters per password, and my default one is 26 characters. I don't trust billion dollar companies with securing my banking information. If people want to take my money, they'll have to make an effort and go through my trash.

greggman 14y ago

Checks don't exist in Japan for the most part either. On the other hand, rent in Japan is usually paid by bank transfer at $6 per transaction (done at the ATM or online). Checks, in the USA, are free, no transaction fee

josteink 14y ago

I remember asking my bank about "travel checks" because I read online that this was the best way to pay when abroad. They just looked at me like I was mad and said "nobody uses those any more. Just use your bank card and withdraw cash in ATMs as needed". They literally told me that nobody (as in "no banks", locally) did checks anymore and that they could not be issued even if I wanted them. This was 10 years ago. So yeah. US banking is stone age. And at the same time the US is the world leader in electronic, financial trading with millisecond-trading (microsecond-trading?) being the norm among the big trading companies. It really doesn't make much sense.

goostavos 14y ago

Many places in the US charge ridiculous "Convenience" charges to pay with a credit card. I pay my rent with a check. Why? Because they charge me almost $40 for the "convenience" of using my MasterCard. Same thing when I had my car loan. $15 convenience charge to pay online with a credit card. It's complete crap, and a total racket. Unless I want to pay >$50 month for the luxury of paying my bills in any modern way, I'm back to writing checks.