What are they doing with my money ???

K

kfpg

Guest
How come when I make an online payment to my credit card or mortgage the money goes immediately from my current account through the wonders of technology BUT through the same technology it takes up to 2 days (maybe more I'm not timing it) for the payments to be reflected on my mastercard or mortgage account (both of which are the same bank as current account)

This has bothered me for sometime so wonder what the rest of u think, can i complain, do they just screw people until you make an official approach and then they 'adjust their procedures' or some b*lls**t.

Obviously the two days costs me money on a small credit card balance but a considerable amount over twenty years interest on a decent size mortgage.
Any ideas???
 
AIB have told my company that when they do the (credit?) transfers for salary payments to employees they post cheques to the banks in question - i.e. there is no electronic automation of this process. I am not sure if this is the norm but, given that I'm with another bank, it definitely takes a few days for my wages to hit my account and then a few more to clear. Others who are with AIB too get theirs more or less immediately. :\
 
Electronoc Payments

Take your point but I think the situation described above is different.
No cheques
Same Bank
Performed Electronically online
 
Re: Electronoc Payments

I asked someone inside the bank to explain it to me once. He explained that they don't profit from the money over the few days it's "Missing". But to be honest I didn't understand it.

I trust him though.

-Rd
 
Trust = Banks = ??????

Daltonr, I admire your trust in any bank in the current climate, you must be in a minority. I don't trust them at all.
 
Re: Trust = Banks = ??????

I think the problem here is that once you make the payment via the pay bills in your online account, your account balance shows the money to be gone immediately i.e. your account balance is short the amount even though it will take 3 working days to reach the other account. Right ? So you're wondering if you have an account that pays a (small) interest rate you would lose out. I guess the answer is yes but its a tiny fraction. The bank would not gain on your other account as the money would still take three days to actually get there (This is what Rd is saying). This is the online protocol I guess. We are talking tiny amounts here.
 
Re: Trust = Banks = ??????

> Take your point but I think the situation described above is different.
No cheques
Same Bank
Performed Electronically online

Yes - but my point is that even with transactions involving the same bank but perhaps physically different locations (e.g. mortgage head office, VISA head office etc.) it's possible that the manual "put the cheque in the post and then wait for it to clear" system is also used even for intra bank transfers?
 
Electronic Transfer Process

Elcato ofcourse you are right that the money being "gone" from my account is tiny and it does not concern me in terms of loss of interest which might accrue to me.

I'm more interested in the fact that mortgage interest is calculated on a daily basis in most cases therefore I am charged 2 days additional interest whilst the bank system moves my money around. This is a more significant amount on a 250k mortgage over 25 years !!!

I cant believe (maybe I should) that the same bank is sending itself a cheque between divisions and have not in this day and age automated this electronically!!
 
Re: Electronic Transfer Process

As far as I'm aware (and I could be way off here) online transactions are batched and run through the system in off peak time. They are then balanced before being updated on the other end. I'd expect the computer system within the bank to be running real-time so I don't believe that the other account being local or remote would be updated until the full process is finished. I don't think all transactions are posted anymore and the three day allowance is a ball-park. It is no doubt set so the bank would ultimately gain I'm sure though.
 
Re: Electronic Transfer Process

Daltonr, I admire your trust in any bank in the current climate, you must be in a minority. I don't trust them at all.
Click to expand...

It's not a matter of trusting them. This wasn't an over the counter chat. I know the person and I was trying to understand how it works.

Unfortunately I still don't fully grasp it, but I'm pretty confident that they are not profiting from holding your cash for a few days in "Limbo"

I'll try again to get my head around it and report back.

-Rd
 
Re: Electronic Transfer Process

This is one of my pet hates with banks (and god knows, I have a few).

Regardless of what they are actually "doing with the money" once it has left your account, surely it is in some holding or suspense account somewhere earning interest for them. Not a lot on each transaction, I'm sure, but huge when all the money floating around is taken into consideration. And even if the money is not in some kind of suspense account, it is still in the interest of the bank to have it gone from your current a/c, because they can whack the lovely referral charges on you and follow up with interest if you go overdrawn, as well as charging extra interest on your mortgage/credit card. Cushtie.

When you make an express lodgement, they can credit your account with cheques within the hour no matter what bank they are from, clear evidence of how quickly they can act if it suits them. If the cheques are "bounced", they just debit it back out again a few days later.

It's not good for my blood pressure thinking about this stuff.

Rebecca
 
EFT etc etc

"When you make an express lodgement, they can credit your account with cheques within the hour no matter what bank they are from"

Yup,

I needed to send some dosh to an English company a few weeks ago. Faxed instructions to the bank we use ( not one of the clearing banks ) around 10am. Phoned the company an hour later to tell him to expect money & was told it had already been credited to their account.


eDog
 
Re: EFT etc etc

"When you make an express lodgement, they can credit your account with cheques within the hour no matter what bank they are from"

When you lodge the cheque it is 'Cleared for value' - for the purpose of the calculation of interest, the cheque's value is applied to the account. It is not 'cleared for fate', whereby the cheque has been paid and the payee can draw funds against it. It is only after the cheque has cleared, which may take a few days, that this can happen.
 
Re: EFT etc etc

So why not credit your mortgage/visa/whatever account "for value" immediately (since we know they can if they want to) and then adjust "for fate" if needs be. I maintain, it just doesn't suit the banks; because if it did, it would have been sorted years ago.

And I know they are profit-making institutions, and no I don't expect the services for free, but I do expect a bit of transparency and goodwill and we just don't get it.

One example of the many of little things they do to irritate me, today at work we received the notification of refund because of the AIB FX debacle. They say there were 36 payments involved and that's it. They give no details of what they are or the sums involved so that I could cross-check with my records. I know I could ring the helpline, but the point is that if they know what they are, why not show a bit of willing and give us the info upfront without it having to be dragged from them. At least now they appear to be beginning to act to the letter of the law (under duress mind you), but what will it take for them to operate in the spirit of it.

In real business, this is not how we treat our customers. With changes in technology more and more people are pushed towards the same few mainstream banks as custodians of our money and it feels as if we are powerless to demand the treatment we deserve. I'm completely sick of it.

Rebecca
 
Re: EFT etc etc

"So why not credit your mortgage/visa/whatever account "for value" immediately (since we know they can if they want to) and then adjust "for fate" if needs be"

There is no difference between value and fate for payments to credit card, motgage etc. as you are making the payment not receiving it. The intended recipient does not know you are making the payment before they receive it.

As for giving credit immediately, my bank does on the same day provided the source and destination are in that bank (and that on-line credit card payments are made before 5.00pm). For transfers between 2 of the clearing banks with which I have accounts, submitted online, I make the payment Day 1, it is processed overnight, sent to the recipient bank and in my account the morning of Day 3. I am not trying to defend the banks, but unless you want all banks to have access to all the details of your account in the same way as your own bank does, I don't see how you can make it any quicker.
 
Same Bank

Statler,
What do you think about my situation.

How soon should a deduction from my current account be posted as a payment to my mortgage account, given that the payment is electronic direct debit and both the current and mortage accounts are in the same major irish bank?

By the way I agree with everything Miss Ribena is saying!!
 
Re: Same bank

kfpg,

2 accounts in the same bank should be same day value.
Can I ask waht bank you are with?

This is from AIB's Terms & Conditions:
"Upon receipt of instructions to effect an Intra Account Transfer the Bank will forthwith effect such transfer instructions at debit of the Account. Where the transfer is carried out on a non-business day, the transfer may not be effective for interest purposes until the Business Day next following the day on which the instructions were received."
"Intra Account Transfer
The transfer of funds by the User: (i) for credit of any other Account, and/or any third party account maintained with the Bank which is made at debit of an Account using the Adviser Facility (ii) for credit of any other Nominated Account, and/or a Mandated Account which is made at the debit of a Nominated Account using the Self-Service Facility and/or AIB 24hour-online."
 
Re: MBNA netaccess

With my MBNA netaccess account I periodically see the same transaction listed in both the unposted and posted transaction sections simultaneously. This reduces the available to spend amount by twice the value of the transaction. The unposted section doesn't say what the transaction is, it just has to be inferred from the rounded amount. It sorts itself out after a few days but it's worrying to see.
 
Re: MBNA netaccess

NIB advised me to use 'Funds Transfer' rather than 'Make Payment' when paying my NIB visa card from my NIB current account via online banking. The 'Funds Transfer' goes through immediately without any need for clearing, whereas the 'Make Payment' goes through the standard 3-day cycle.
 
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