Thread by @patio11

A conversation I have frequently about ACH speeds.

Me: The most important factor to understand is Reg E and the broader constellation that makes banks liable for consumer accounts being drained.
X: But other nations manage this without slowing down bank transfers.
Me: Which one.

X: Take India for example.
Me: UPI is an extremely impressive payments system and public/private partnership. What will a bank tell you if you are abused using it?
X: ‘LOL skill issue bro’
Me: Yes, really important to understand that American banks cannot do that.

X: What really.
Me: Yes.
X: But the U.S. is legendarily hostile to consumers relative to many other developed nations.
Me: Regulation E is short and straightforward. Here is an official dot gov explainer of it. Here is a screenshot of an American bank statement note about it.

X: But they probably just /dev/null all calls about it, right.
Me: In fact they do not, as you would know if you had been an unpaid advocate for people with banking issues. To their discredit, they do attempt to do this with regards to Zelle specifically, for biz strategy reasons

X: I knew it was just an excuse!
Me: Do you understand that Zelle being instant and free is core to the reason they engage in these shenanigans basically uniquely w/r/t Zelle payments and not w/r/t ACH or debit or credit or…
X: Your banks are just so bad.
Me: *sigh*

X: Perhaps because it is your nation is so bad? What with the crime and all.
Me: I have had the experience of living in Japan, which for various reasons has a low crime rate. Do you know what poster adorns the foyer of my condo?
X: Can’t possibly be relevant.

Me: The Tokyo Metropolitan Police’s periodic exhortation attempting to prevent mostly elderly people from being abused through instant bank transfers of their life savings.
X: What how is that a thing.
Me: It’s very much a thing. See also most ATMs in country.
X: What.

Me: Yeah they might have a life-sized cutout of a police officer next to them saying “Are you on the cell phone? STOP. It’s a scam.”
X: Oh bullshit.
Me: *shows photo*
X: That’s not AI?!
Me: At many ATMs it is a smaller earning but I do like the life sized cardboard cop.

Me: Anyhow this has many downstream implications, too. For example, banks receiving ACH transactions will not credit them instantly, due to fear of reversal. This will frequently be on a case by case basis.
X: Hah like bank transfers can be reversed. Can you even imagine that.

Me: I can, in fact, imagine a bank transfer system where any transfer a receiving bank gets must be immediately sent back if the sending bank asserts any reason for a reversal over a relatively short window and then, oh, 60 days or so in the case of fraud.
X: But that doesn’t…

X: … work. They’d lose money all the time.
Me: Yes it is indeed a costly guarantee to make.
X: No bank would actually go through with that. Banks are bastards.
Me: *pounds head into table*