I Love Banks

Deviating a little bit from the agile topics, Im writing this post to tell a little story about my relationship with a certain british bank, and how well they use IT for the client’s benefit.

I dont want to tell the bank’s name, because the purpose is not to create bad advertising or something like that, so for the moment I will just call this institution the bank of the citi.

So, beginning the story, last month I was surprised by having been charged interests in my credit card bill, despite having the feeling that I had payed in the right day. I sent my bank a message, which was replied:

our payment due date was 27th October 2008 and your payment was made on the 29th October 2008. Because the payment was late you have been charged the late fee and the interest.

Ok, but I still thought I’d payed in the right day, so I checked my account info and verified it. Second message to the bank of the citi:

my account info show the transaction was made on the 27th.

27/10 TRANSFER 538813

Why it is just considered in the 29th?

And then comes the surprise (in form of a reply):

When making a debit card payment to your credit card the timescales are up to two working days for it to clear onto your account.
If you require anything else please don’t hesitate to contact me again.

Then I thought: What?? And kept trying to understand how possibly it could take 2 working days to transfer some money electronically to the same bank.

Since I was in a good mood and the attendant had offered me his help, I decided to send another message:

I think the only question I have is how come it takes 2 days to do an electronic transfer, but probably it won’t solve my problem.

And here comes the answer:

It takes two working days for a debit card payment to clear onto accounts as it has to go through clearing and then be allocated to the correct account.

Oh, now I understand… It’s not a simple operation, like transfer the money. You actually have to subtract the money from one account, clear it (whatever this means), and then transfer it to the other one.

For some days after this whole conversation occurred, I tried to think how someone managed to build some software that needs 2 working days to perform one operation.

I thought that maybe there’s one batch job that gets the money from my account (which runs at midnight at D+1) and another one that gets this money and adds it to the other account (midnight at D+2), or  both operations happen at D+1, but then they need 24 hours to verify if the transaction was correctly performed, or there’s actually a person that goes to the safe where my account is, counts the money, and then goes to some other building where the bank account is, opens the safe and stores the money there… actually, no, this would be much faster than 2 days.

  1. Hates_ said:

    I remember someone telling me it was so they could collect a bit of interest on the money while it floats around, but that sounds a bit too “conspiracy theory” for my liking. I could kind of understand the delays with paying in cheques, but with electronic transfers, the delay is a far cry from everything we expect in the digital realm.

  2. Hey Frank,
    It’s an unbelievable… I like the way you figured out the batch processes problem, though. lol
    What do you think about signing up for internet and having to wait for 20 WORKING DAYS to get it installed? It happened to me in Oz… But, as you said, we need good mood to sort this out. cheers mate

  3. Hates_ is right…They hold onto the money to collect interest on it…with thousands of transactions going on that can be a nice little earner…charging other people for them giving you the priviledge of nicking their interest (by investing it in the stock market) is pretty low though!

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