General > General Technical Chat
Cheques being phased out in Australia by 2030
nctnico:
--- Quote from: tggzzz on October 17, 2023, 08:30:12 am ---
--- Quote from: Halcyon on October 17, 2023, 08:25:06 am ---
--- Quote from: tggzzz on October 17, 2023, 08:13:45 am ---
--- Quote from: Halcyon on October 17, 2023, 12:03:37 am ---As a bit of a side note, I just got an email from my bank this morning. From 20/05/2024, they will no longer accept deposits in the form of cheque or cash, with cheques to be completely phased out by November 2024.
Cash withdrawals from an ATM will still be possible.
https://www.macquarie.com.au/help/general/cheque-and-cash-changes.html
--- End quote ---
So you take out cash and pay a merchant, who presumably cannot pay cash into their account?!
--- End quote ---
Business accounts will still retain the ability to deposit cash since most stores still accept cash.
--- End quote ---
What happens if I sell treasures at a hamfest, and wish to deposit cash?
--- End quote ---
Why would you accept cash? Every now and then I buy & sell second hand stuff. Items over (ballpark) 100 euro get paid by bank transfer. Over here it is rare for people using cash nowadays for these kind of transactions. Keep in mind cash can be counterfeited, a bank transfer where you check the balance on your own phone in realtime doesn't have that problem.
--- Quote ---What happens when bank attacked or attacks itself or card swallowed (q.v.)? All those have happened and will happen again.
--- End quote ---
Having accounts at multiple banks works well. I have 3 working cards in my wallet. And it is good to have some cash on hand in case electronic payments are down for a day.
SeanB:
Good reason to accept cash is that you have a chokepoint on card transactions, the processor that handles the transaction from the store, and routes it to the bank. They outsource all the IT, and it is only a single keystroke mistake away from having a RBS month, where customers were completely unable to use cards, people were losing houses to foreclosure because debits did not go off, and people could not buy food, electricity or gas, plus were not being paid, as the money went from the sender account, but vanished into nothing. All because somebody in a outsourced data centre, with only a sheet of instructions to follow, not even at any way computer literate, or fluent in English, mixed up 2 steps in the process of completing a day transaction batch, and overwrote the entire database by attempting to restore from an empty backup. Took a good few months to get them more or less running again, and cost them a good chunk of the customer base as well.
Choke point, in that all banks use the same 2 processors, Visa and Mastercard, represented by me by SASWITCH, and a failure at one will cascade through to the other rapidly, leaving no cards working, and even affecting ATM operations, as they also use the same switching networks to allow other bank use, and this comes before the own bank mainframe (or emulation) is able to process the transactions, and a lot of the internal bank systems are also linked this way. Very common to have 10-20 minute outages on the networks at times, but not noticed by customers much, as you are not using them 24/7, but only for a minute at a time. You just see it as a error, and the store tries again, perhaps after a minute, and you are at the edge of the window.
By me 45% of the population is on welfare, with 7% as active taxpayers. So 45% use a card, and have little issue with it to get grant payments, and the vast majority are older women, and single parent households bringing up children, plus a lot of child headed households. Card gets used once a month to draw cash and buy food, and the banking system had been forced to totally block any direct debit ability from those cards, aside from a few select providers who have that in limited form, because of loan sharks that entered direct debits against multiple cards, and emptied them on grant day.
tggzzz:
--- Quote from: Halcyon on October 17, 2023, 08:44:36 am ---
--- Quote from: tggzzz on October 17, 2023, 08:30:12 am ---What happens when bank attacked or attacks itself or card swallowed (q.v.)? All those have happened and will happen again.
--- End quote ---
I'll take that gamble. You can't exactly compare banks in parts of Asia to here.
For starters, every deposit holder in Australia is backed by the Australian Government Financial Claims Scheme, which is designed to protect up to $250k per account holder, per bank should the bank fail. That amount is guaranteed by the Government without any additional insurance or need to opt-in.
--- End quote ---
That scheme is completely irrelevant to the point; nobody is talking about a bank failing. (Having said that, some of the points below indicate that technologies could cause a bank to fail.)
What I'm thinking of is, for example, where a bank upgrades its IT systems in a grossly incompetent way such that customers are unable to access their accounts for weeks. That's happened several times, and is increasing, to the extent that the UK Government has become involved (my emphasis) particularly paragraphs 17-24...
--- Quote ---After a number of significant IT failures, such as that experienced by TSB in 2018, this
inquiry provided an opportunity to look ‘under the bonnet’ of the financial services
sector to ask why IT failures were happening, and how the industry and the Regulators
could have prevented such incidents.
Bank branches are disappearing from our high streets and local communities, and
cash machines are being withdrawn. Customers are increasingly being expected to
use digital services, and yet these services are being significantly disrupted due to IT
failures. Consumers suffer from harm when these IT failures occur. They have been
left without access to their vital financial services and have been left unable to make
payments or withdraw cash. Small businesses have been left without the basic banking
services necessary to run their businesses.
...
17. IT failures, or incidents (used interchangeably), within the financial services sector
appear to be becoming more common. Over the past 18 months there have been major
incidents at TSB and Visa, along with a litany of incidents at other firms. This increasing
trend is recognised by the FCA, which stated in 2018 that “outages in the financial services
sector are becoming more frequent and publicised” and that “the number of incidents
reported to the FCA has increased by 187 per cent in the past year”.17 Furthermore, the
Regulators reported that 65 per cent of the incidents notified to it in 2018 were from the
retail banking sector, including payment services firms, over five times the next highest
sector, wholesale financial markets.
...
I have not been able to access my account for two weeks now. I have fluctuating
balances, no idea which direct debits and standing orders have been paid, and
my data has been compromised. [ ... ] I have been unable to use my debit card
for purchases as, for a week, my balance was zero. This meant I was unable to
withdraw cash."
"She told me how she sent five emails without response, she spent five hours on
the phone to you at 30p per minute [ ... ] She relies on pension credit. Her
account is now in debit. She said, “I am at my wit’s end, no electricity or gas,
running on emergency, which is about to be cut off. Help please”."
"Unfortunately, after nearly two weeks, we will not be able to submit our formal
mortgage application as the lender—thankfully not TSB—has requested three
months of bank statements. We are still unable to download our bank statements
[ ... ] “We are now faced with the possibility we could miss out on buying the
house our family needs”."
House of Commons, Treasury Committee: IT failures in the Financial Services Sector
https://publications.parliament.uk/pa/cm201919/cmselect/cmtreasy/224/224.pdf
--- End quote ---
Halcyon:
I'm not suggesting technology never fails, but perhaps the UK banks need to better oversight, particularly when it comes to their IT systems.
I've used debit cards since I was 14 years old and I can remember two occurrences where a payment failed because of a technical issue.
One happened about 15 years ago when there was some kind of widespread outage, since then, payment terminals have been updated and cards have changes, which means the way transactions are handled between then and now have changed.
The second occurred about 5 years ago, as the store relied solely on 4G/5G and didn't have a WiFi or Ethernet backup to their card terminal. It just so happened at the time I made the purchase, the connection to the cellular network dropped and caused the payment, which was mid-transaction, to fail. I tried again a moment later and everything was fine.
That's my personal experience over many years and probably 25k transactions later and relying on one single bank, and one single card/account.
Many people have multiple accounts. It might be debit card account and a seperate credit card. Those accounts don't have to be with the same bank or even the same merchant. But even with the same card, you have a choice of "networks". For example, if I tap my card, the payment is routed via Mastercard's network. If I insert the same card and press "savings", the payment is routed via the EFTPOS network. That's redundancy in one single card in and of itself. Either way, the money comes out of the same place and costs me nothing.
Also, in case of entire network failure, most payment terminals now fall back to an offline mode so that payments (meeting certain criteria) can proceed.
If I'm at home and wanting to pay bills online, I have at least 3 different ways of doing it, all from the one bank account.
Whilst no system is perfect, I've lost more cash by it simply falling out of my pocket, than I have in the value of digital payments failing in my lifetime. My entire point is, even if you took cheque and cash away from consumers (in Australia), there are various other methods available to make payments, pay bills, buy groceries etc... Sure, some people will need to make adjustments, but it's not onerous or impossible.
During this entire thread I'm also speaking from our point of view down here. I completely understand that our approach here probably won't work in a lot of countries because of various reasons. No one ever suggested that "Because Australia and New Zealand are moving to digital banking, so should everyone else". At the end of the day, technology, no matter what it is continues to evolve. If people choose not to embrace it, then they get left behind.
As I've also said, consumer spending habits usually dictate these things and the vast majority of the population have embraced digital-only payment methods and that number is only increasing. The number of customers using cheques is down in the noise and cash really isn't all that far behind.
tggzzz:
--- Quote from: Halcyon on October 17, 2023, 12:34:58 pm ---I'm not suggesting technology never fails, but perhaps the UK banks need to better oversight, particularly when it comes to their IT systems.
--- End quote ---
... But you don't include such failures in your belief that cheques are unnecessary and desirable.
Here's today's example https://www.theregister.com/2023/10/17/barclays_outage/ Getting a person to answer the phone is very difficult in normal circumstances, and impossible during widespread failures. After all, telephone banking is too expensive when most people use cards. Isn't it?
Saying "need better oversight" presumes that more management could improve the issue. I don't believe that, since people are people and the systems are enormously complicated conglomeration of individual systems.
--- Quote ---Many people have multiple accounts. It might be debit card account and a seperate credit card. ...
If I'm at home and wanting to pay bills online, I have at least 3 different ways of doing it, all from the one bank account.
--- End quote ---
So you are now presuming that people that have difficulty getting one account should get several accounts! Ridiculous and impractical.
In the worse IT failures people have lost all electronic/telephone access to their accounts. At least cheques could be accepted and presented in the future.
--- Quote ---Whilst no system is perfect, I've lost more cash by it simply falling out of my pocket, than I have in the value of digital payments failing in my lifetime. My entire point is, even if you took cheque and cash away from consumers (in Australia), there are various other methods available to make payments, pay bills, buy groceries etc... Sure, some people will need to make adjustments, but it's not onerous or impossible.
--- End quote ---
While systems are working, that is fine for many people. Even during those happy daze (sic) it fails for many.
I'm glad you aren't in charge of ATC, since you would think that ATC controllers would never need to revert to paper strips (containing flight details) thrown across the room from one controller to another.
Yes, access to your own money can be as life critical as ATC.
--- Quote ---As I've also said, consumer spending habits usually dictate these things and the vast majority of the population have embraced digital-only payment methods and that number is only increasing. The number of customers using cheques is down in the noise and cash really isn't all that far behind.
--- End quote ---
And I have said that I rarely use cheques. Nonetheless, they are useful sometimes. The cost justification for stopping them doesn't stand up to scrutiny.
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