Online bill payment systems, sometimes they suck.
- Thread starter ed629
- Start date
Eh, I have very easy access to a post office so it's no big deal for me. Around here, most places won't even take checks for rent, they insist on money orders.
Excellent point. Many people bank with small regional/community banks and credit unions. And often they don't have all the established payees in their systems.
But if I understand our friends in the UK correctly all you need is a bank account with the control #'s to establish an electronic payee and then the process of linking up online is seamless.
I don't completely understand why it's more difficult here but it seems to be.
There likely are more privacy freaks here in the US too that refuse to create electronic links with anyone that is driving some of the problems.
This is what automated clearinghouse (ACH) payments are for. Technically, all you should need to move money between two bank accounts anywhere in the US are a routing number and an account number.
You know, that's one thing I've never written.
Without googling, I'm not even sure I can say what they are or why you'd use one in preference to writing a cheque. I know they're some kind of paper-based payment method that you go to post offices to do, but beyond that, no damn idea!
As a landlord, I'm happy to report that my butt is card-free.
Money just arrives electronically in my account monthly. In fact, as I use a property manager to deal with the tenants and maintain the property, money in fact moves seamlessly from the tenants, to the property manager's account, and then on to me. The manager deducts their monthly fees directly from my account electronically too. Easy-peasy lemon-squeezy.
We process checks in America and review, analyze, investigate etc. if they're valid.
And you complain about ONE extra letter in cheque...
That's right. There are several different ways to do this though.
If you're making a recurring but potentially variable payment to someone else (eg a utility bill) the vendor can do this by setting up what's called a Direct Debit payment. All they need is your bank account number and sort code, as well as your name and the name of the bank obviously. There's no extra security/privacy risk to providing this information as you'd be giving them that info anyway if you paid by cheque or card (it's printed in plain view on both). They set up the Direct Debit with your bank account seamlessly. They don't necessarily even need your signature on a bit of paper to set one up; it can be done in seconds and completely paperless via the phone or internet, provided a strict protocol is followed. (In the USA, I believe this is called an ACH payment).
If you're making a one-off payment to another individual (or small business), or a fixed recurring payment (eg rent to a landlord) you can set up either the one-off payment or recurrent "standing order" from your online banking, provided you know their account number and sort code. Again, takes just seconds to set up.
These systems work irrespective of which banks each party is using, and carry no fees in and of themselves (business bank accounts sometimes carry fees for deposits, but that's something different). In fact, because there's no paper, you often get a discount, esp. with direct debits.
(there other kinds of electronic cash transfers used for significantly larger sums (eg buying a house or bigger car) which carry a fee as there's a value limit on the above systems - I think my bank tops out at £25k or £30k for retail customers - but I won't complicate the picture by going into them).
Last edited:
All of this is exactly the same in the US.
This is what's different. Each bank has to estblish a link with the vendor/payee. Small business people [like small landlords] must establish a separate link with each individuals bank if they don't have one. This is typically accomplished by the bank making a $1 charge into the account as a 'test draft.'
Similar threads
