After over a decade as an online banking user there’s one thing that still frustrates the hell out of me here in the US. The time it takes to move money around when banks are involved.

It’s quicker to drive to Bank A, withdraw a bunch of cash, drive across town to Bank B and deposit it, than it is for an electronic transfer to complete.

With branches open until 6pm and even on Saturdays the first hurdle is that you need to make sure you have your request to transfer in the system, on a week day and before some arbitrary time (it seems to be before 4pm East Coast, which doesn’t help when you’re on the West Coast in the US – 3 hours behind). Then the process can take 3, sometimes 4 business days before the funds are available at the destination bank. What is really insane is when this happens between accounts with the same bank. Makes you wonder who profits from this delay.

For an account to account transfer within a bank I’d expect to see that reflected pretty much instantly. For a payment to a Credit Card with that bank I can’t see why it would take longer than an overnight run. For a bank to bank transfer … unless they are physically putting the money in a truck and driving it across town I’d expect to see an electronic transfer happen overnight.

Even when the money has gone from A to B you run into the Statement Balance vs Current Balance problem. Rather than show you all the transactions they know about, some banks seem to have taken the concept of paper statements and put them online. So what you get is a view into what your account looked like a day, or a week ago with some mysterious delta between what the statement knows your balance was (and the transactions that made it up) and what the bank knows about your actual money – because they can correctly track the current available balance.

This sluggish updating not only impacts customers using the banks own systems, it makes life tougher for services like Mint (who already have enough problems of their own!)

Finally… what’s with expiring data. Somewhere in the system you’ve got records going back to the dawn of time. Storing them as raw, compressed data electronically isn’t going to take up that much space or cost that much money (even with Hierarchical Storage for the really old stuff) but if I live in a country where at the drop of a hat the tax man can ask for 5 or 7 years of records… make sure they are available. Don’t charge me $25 so you can go and scan the paper copy you printed when you archived it to dead tree. I don’t mind waiting a couple of days while it gets sucked back from a vault somewhere but this isn’t rocket science.

When you look at the profits banks make, and the pitiful interest rates they pay out you have to wonder what’s going on (BTW why is it a “good” US bank is paying 1.10% interest, but an Australian bank can deliver 5%+ and still manage to get my money transferred to a different bank usually within a day)?