Whay are banks still stuck in the Dark Ages?

2:13pm Friday 30th May 2008

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I FIRST realised that the banking system wasn't philanthropic 30 odd years ago when, after years of my being in credit, my bank bounced a cheque, citing "insufficient funds."

My salary had not cleared and the sum due to my local off-licence would have plunged me into the heady realms of a three pound overdraft.

I fired off a letter pointing out that for years the bank had had the benefit of all my spare cash and that I found it fairly rich (sic) that they begrudged me a little bit of theirs for a couple of days.

I have learned since that banks understand large overdrafts much better than tiny little ones.

In fact, they like the big ones very much indeed and get disappointed when I make the occasional foray into credit and promptly try to encourage me back into indebtedness.

My big grouch is not with my bank in particular, but all banks. The age of instantaneous worldwide communication doesn't seem to have nudged the monolithic banking system into even the 20th Century yet.

I received a cheque (check?) from America this week.

When I tried to pay it in I was informed that it would probably take six weeks to clear.

"Surely you mean six days?" I enquired politely.

They didn't.

The actual piece of paper I handed to the teller would, apparently, have to be returned via snail mail to the New England bank upon which it was drawn.

This process was typically taking around six weeks.

There was something in the manner of the teller that indicated to me that she was aware of the complete ludicrousness of the situation.

She didn't actually shrug in shared hopeless bewilderment, but the acknowledgement of common incomprehension was unmistakable.

I couldn't do other but take her advice and refer back to the drawer of the check' to ask them to remit the funds electronically which, even then, would take three or four days, as in the UK.

Where the money goes between leaving the drawer's account instantaneously and arriving at the payee's much later is, of course, quite clearly a place where the banks can use it to make money for them.

If they were only to admit that and shift it instantaneously, as is clearly possible, then we might all accept any slight extra cost to recompense them for forgoing that hidden income.