Banks
I bet they get rich very quickly indeed.

For instance, I put a cheque in on Thursday. It's still not cleared. Why not?

With today's super-fast computer networks and automatic processing, why:

1. Does it still take 5 working days to clear a cheque?
2. Why only 'Working' days?
3. If it's all done by computer anyway, why does it matter if anyone is there or not?
4. In today's world of 24 hour, 365 day a year business, why is the 'working' day, according to banks, still only 9-3.30 Monday to Friday? Even though they're open on Saturdays, why does no work get done?


Actually, I know exactly why it is. It's so they can hold on to your money for as long as possible. Theoretically, I bet it's entirely possible to have a cheque clear in two seconds from putting it in.
(Half of Stephen Fry's right buttock pissed on your dog on, Mon 4 Aug 2008, 9:52, 15 replies)

.
Yeah - if I go to withdraw £10 from the machine, it doesn't take 5 working days for the machine to decide if I have sufficient funds, does it?
( browser still relating boring anecdotes into a void on, Mon 4 Aug 2008, 10:12, closed)

it should be possible for a cheque to clear
but since they centralised cheque processing rather than doing it in branch at the end of every day I'm surprised it doesn't actually take longer

the more important question is why the fuck does anyone still use cheques these days?
( Vipros. clever got me this far, then tricky got me in, Mon 4 Aug 2008, 10:14, closed)

^^^^^^^
I use cheques because they take 5 working days to clear.
( browser still relating boring anecdotes into a void on, Mon 4 Aug 2008, 10:16, closed)

All your questions answered
1. Does it still take 5 working days to clear a cheque?
Yes, because banks are cunts.

2. Why only 'Working' days?
Because banks are cunts.

3. If it's all done by computer anyway, why does it matter if anyone is there or not?
Because banks are cunts.

4. In today's world of 24 hour, 365 day a year business, why is the 'working' day, according to banks, still only 9-3.30 Monday to Friday? Even though they're open on Saturdays, why does no work get done?
Because banks are cunts.

There, I hope that clears it all up for you.
( reallywittyname veraciously conspues lexiphanicism on, Mon 4 Aug 2008, 10:16, closed)

@Vipros
But it's all done by computer.

1. You pay a cheque in.
2. Your bank passes details of the cheque to the central office.
3. The central office contacts the other bank to find out if there are sufficient funds to clear the cheque.
4. If there are, your bank's computer credits your account, and the other bank's computer debits the person's who issued the cheque.

With broadband internet connections, how can this take more than 10 minutes?
(Half of Stephen Fry's right buttock pissed on your dog on, Mon 4 Aug 2008, 10:19, closed)

I still use cheques
Mostly to pay bills and stuff. It just means that the money stays in my account longer than it would if I were paying by card.
(The Empress it seems you CAN polish a turd!, Mon 4 Aug 2008, 10:37, closed)

In Canada,
There is a debit card called 'Interac'. It works exactly the same as debit cards here in the UK, and has been PIN-only access for more than ten years.
If you make a purchase with your Interac card, and then immediately go to a bank machine or go to your online banking, the money you spent is GONE. None of this Balance vs Available Balance rubbish. The bank knows the second you purchase something, and posts it to your account that second. Why can't England banks figure out how to do that? Surely the UK has a more powerful financial market than Canada?
(w4I4q1O1 was hard at work on, Mon 4 Aug 2008, 10:46, closed)

I have a postal savings account
and always pay in by cheque.

mainly because I cannot be frathed to setup a standing order.
(Halfy By light alone, Mon 4 Aug 2008, 10:52, closed)

UK banks have apparently wanted to this for ages.
The missus is a bank manager and was told that it was the business community that was resisting the change to an instantaneous system. For exactly the reason that Empress BobFossil likes cheques - the lovely lag. This allows them to "rob Peter to pay Paul". They can recieve instant payment from us (assuming we aren't using cheques) and have a rather delayed payment to their creditors.

As usual, it is all arse :)
(roar, Mon 4 Aug 2008, 10:57, closed)

@Stephen Fry's buttock
not at the bank I worked in which is where I was when they introduced the centralised clearing.

rather than being run through the machine in the branch, all the cheques etc. were bundled up and sent to bristol with the cheques from a million other branches to be dealt with.
( Vipros. clever got me this far, then tricky got me in, Mon 4 Aug 2008, 11:17, closed)

i think
if the cheque you are paying in is from the same bank as yours, it is cleared instantly, otherwise there is a delay.


at least that's how it is here in Spain, where we have WEEKLY credit cards, and the delay is only 2-3 days (in total - unless you pay in on the weekend)
(bamboozled Can hear you getting fatter, Mon 4 Aug 2008, 15:14, closed)

@w4I4q1O1
With the whole stupid mess between "ABM"s and "ATM"s in Canada, don't you dare try and tell me that Canada's system is one we should emulate. I had a nightmare trying to get hold of my funds while I was over there, VISA apparantly being some unknown monster to Canada's banking system.
(Musuko, Mon 4 Aug 2008, 15:59, closed)

This may have changed, but 5 years ago (before I left Oz), if you took a check into the bank and said it was wages (and it looked plausible) you could cash it straight away.

I was doing a lot of relief teaching ($32 an hour! There's a good way to make some cash!).
I would get sent paychecks every second Thursday, and take them all down the bank and get them cashed in one go, ready for the weekend.
(Celerydemon, Mon 4 Aug 2008, 16:08, closed)

Physcal cheques stil needed
Electronic clearing is great, I work in the states for a bank in the computer systems department.

Reason for the waiting period is for verification of the cheque in case of fraud (to protect the bank of course) They don't want people to come in with fraudulent checks, cash them, and walk out with the cash - so the physical checks are shipped to the issuing bank for verification. You'd be surprised at the amount of security features that are built into the checks to prevent fakes from being produced and cashed. The 5 day (or however long it is now) waiting period is there so the checks can be physically verified - they of course electronically debit the amount from the account immediately.

Most banks in the states will balance the inconvenience of the waiting period by making a partial amount immediately available - some will make it all available for long-standing customers, but that's a risk the bank takes that they're cashing a fraudulent check. They'll also make funds immediately available for things like payroll checks with the assumption it's not a forgery - which in itself is a great get rich scheme (check out the movie "Catch Me If You Can" for instructions on how to do this.
(Fogbound, Mon 4 Aug 2008, 18:30, closed)

Ghosting
It's called ghosting.

If in a rush, it takes about 10-25 seconds to clear a cheque (as I've watched the programs run through on a large financial institution's mainframe), if things were really pushed... but this is how it really goes :

You pay in cheque
Bank takes money off payee rather sharpish (normally that evening), 'ghosts' the money into their account
They play it on the stock market, or have it there as money to invest for a couple of days - i.e they make money off your cheque using it as capital
3-5 day term comes up, job runs on bank's mainframe in the morning, 'deghosts' the money into your account.

It does also prevent fraud slightly, things can be cross-examined, but mainly I believe it was for the £££ they make.

Thousands of cheques, millions of pounds in ghosting = good profit.

Bastards eh?
(Wildchild, Mon 4 Aug 2008, 23:42, closed)