Why is transferring money from one person to another still either slow or expensive?

There are two good answers to this:

One is that there is a cost associated with everything: the banks have salaries, overhead, and risk. I have two business operating accounts and it costs me $2.00 to move money between them at any time. But writing software costs money and maintaining computer security does too.

The other issue is risk. I can use ACH transactions to pay or receive funds from customers or vendors at a minimal cost but this is because the accounts at each end are verified. You can do what is called a Fed wire which is a transfer into another bank account in the US for about $10.00, not a very high cost, but the transfer is irrevocable and the bank takes no risk in making the transaction because I as the sender have verified where the money is supposed to go.

You can use remote deposit which is the automated check processing introduced a few years ago by the Fed. You know the one where it may say substitute check on your bank statement. THe problem here is how long the bank may hold the deposit and hang on to the float depending on the source of the funds.

There is no free lunch when it comes to this stuff.

SRM

Don’t you think someone should make some money on your transfer of funds? Heresy!!

Transfers have slowed down because of identity theft regulations. Banks have to verify transactions in a number of ways to in order to safeguard the money.

There are millions of transfers/electronic billpay/etc every day so $10 or even $2 is ridiculous. It all has to do with squeezing every possible penny out of the customer. Back in the 90’s when electronic banking was new, BoA encouraged it because it cut down on costs. My daughter had an account at Wells and they charged $1.50 for electronic billpay. Then they raised the minimum balance for $0 service charge from $750—$1500. One month they changed the cycle date so she ended up paying more than $25.00 in charges on an account with 1 small check written on a $1200 balance account.

The only thing you can do with a greedy bank is to move on. We did and others must have too because Wells changed it’s policy.

Another thing is ATM fees. I have no problem with fees at nonbank ATMs. If I can’t be bothered to stop at my bank and use a nonbank ATM, well they are providing me a service-saving time and gas. But a Wells mini-bank inside Safeway charging a fee is just short sighted. If they gave up the fee, they might eventually get new customers. And there is no fee at the store checkout anyway.

The latest ‘bank’ greed is charging for not carrying a cc balance means paying a fee every month. Right now it is cards that cater to high risk people but since there is a small % charge to merchant, trying to make me pay a fee too is going too far.

If your bank is saving money because you aren’t using a teller and they don’t have the risk of overdraft and they are still charging fees, head for the exit and tell them why.

If you both have Bank of America personal accounts, you can instantly transfer money to each other from those, without a fee. Transferring to OTHER banks will cost you a little bit, though. I think it’s only a couple dollars, though.

It’s instant! It’s free! :)

Naw, I switched to WAMU on a seperate account later and make the transfer through a check deposit at the ATM. Still free.