Slashdot Mirror
Small Bank In Kansas Creates the Bank Account of the Future
HughPickens.com writes Nathaniel Popper writes at the NYT that the Citizens Bank of Weir, Kansas, or CBW, has been taken apart and rebuilt, from its fiber optic cables up, so it can offer services not available at even the nation's largest bank. In the United States the primary option that consumers have to transfer money is still the ACH payment. Requests for ACH transfers are collected by banks and submitted in batches, once a day, and the banks receiving the transfers also process the payments once a day, leading to long waits. ACH technology was created in the 1970s and has not changed significantly since. The clunky system, which takes at least a day to deliver money, has become so deeply embedded in the banking industry that it has been hard to replace. CBW went to work on the problem by using the debit card networks that power ATM cash dispensers. Ramamurthi's team engineered a system so that a business could collect a customer's debit card number and use it to make an instant payment directly into the customer's account — or into the account of a customer of almost any other bank in the country. The key to CBW's system is real-time, payment transaction risk-scoring — software that can judge the risk involved in any transaction in real time by looking at 20 to 40 factors, including a customers' transaction history and I.P., address where the transaction originated. It was this system that Elizabeth McQuerry, the former Fed official, praised as the "biggest idea" at a recent bank conference. "Today's banks offer the equivalent of 300-year-old paper ledgers converted to an electronic form — a digital skin on an antiquated transaction process," says Suresh Ramamurthi. "We'll now be one of the first banks in the world to offer customers a reliable, compliant, safe and secure way to instantly send and receive money internationally."
I live in Chile and we have free instantaneous wiretransfers which are required by law to be protected by 2 factor auth, Banks still make boatloads of money, not sure how the US can still be in the dark ages in this regard.
So is using the IP address the banking equivalent of the SketchFactor app? You just happen to have an ISP whose pool of addresses contains a bunch of scammers. Will this banking software decide that you too are also a scammer? What are the other "risk" factors? ACH made no judgements on the transaction.
You can sometimes spoof your IP address and when lucky have your ISP router forward them, but don't expect to get a reply. I presume making a transaction isn't going to work the one-packet fire-and-forget way.
CLI paste? paste.pr0.tips!
>> business could collect a...card number and use it to make an instant payment...real-time, payment transaction risk-scoring
Congratulations you've invented the credit card!
Silly Americans making news amidst fanfare when one of their companies provides a service that was available elsewhere in the world for 5-10 years.
You need to understand (and I suspect you do) that nine out of ten people who post on Slashdot about anything involving network hacking don't know anything they didn't learn from watching "Hackers".
Unlike the US, banks in other parts of the world aren't in the dark ages.
To the typical American, for whom a Caribbean cruise is exotic world travel, it is utterly unfathomable that we are a full ten years behind the rest of the developed world in banking and internet technology. It simply doesn't compute that the median American earns less and has less purchasing power than the median Canadian, Brit, or Norwegian. We just assume that if it's not available in the US, it doesn't exist. Tell them the number of people in the world with access to symmetric gigabit home internet for $50/month is now larger than the US population, and you'll just get a blank stare. It's like trying to explain indoor plumbing to someone who has never seen it.
I'm an IT guy. I know that transaction takes milliseconds to process.
And like a typical IT guy, what you "know" is beyond question. No way you could possibly be wrong.
If, someday, you work with enterprise systems, you might come to realize that very large systems are often riddled with inefficiencies. When multiple parties are involved, or legal compliance, those inefficiencies can become powerfully entrenched.
Take a look at some of the high rated comments on this article for explanations as to why and how banking is not as efficient as you imagine.
Off topic, but related. When I first started in IT, we were given problems to solve. Now, we're given solutions to implement. Now you implement an idea that a middle manager came up with to solve a problem he (or she) will not tell you about in any detail. Their solution is generally out of date. So you write to their specification and it doesn't work. You, as the IT guy, are to blame--despite not being briefed on the problem to be solve.
So when someone talks about inefficiencies, you have realize that nowadays everyone thinks they can design software. For the most part, that's why so much stuff is in IT is antiquated. How I miss working for people who had ideas that needed solutions.
Unlike the US, banks in other parts of the world aren't in the dark ages. Sending and receiving money via your bank account can be done instantly...
All banks can do this, of course. However, when the money leaves an account, there is an interval when the interest on it can be harvested, legally, until it enters the target account. Given enough bank transfers every day, that adds up to enough profit to give a bank manager an erection (ie. more than $1), and that is why they keep pretending it has to take a whole day or whatever. It used to be the same in Europe, but the evil communists in government forced the banks to give it up.
Please read what I wrote again. The transfer between sender and recipient up here in Kanuckistan is a few seconds - not "all day", and the last time I looked at a map, Canada was not part of Europe. As others have pointed out, Mexico has the same thing, and they're also part of North America. Nor are we "evil communists."
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.