True or Not?

[woopwoop]

If money is paid quicker isn't money received quicker?
So unless you have massive one way traffic from a bank it should pretty much even itself out.

[GreyWing]

No not really, because on day one it used to leave your account, day 2-3 it used to go missing and day 4 turn up in the recipients account.

In these 2 missing days, banks were using this money to lend. However it never really existed, but when they changed it to 1-2 day transfer they had to find all this money that didn't exist.

Don't get me wrong this is some complicated sh1t, I have thought about it 10 times and changed my mind 5 times.

Well beyond me, I'm off for a coffe before I return to start arguing tohe point against what the guy said

[woopwoop]

Yep I'm confused when reading about it and I studied economics and accounting!

When I make a payment from HSBC to someone elses account it usually appears in about 2 hours or less which is great. I think there has to be a good economics argument for the benefits of having prompter payments.

I was also thinking that even if the funds aren't in the 2 days no man's land, but they are in your account, banks are still using this money for loans and other business activity.

So they still have access to do stuff with that money, that's why I was thinkingthat even if money leaves them quicker it'll arrive quicker too.

That's why if there's a run on the bank and people try and withdraw everything the bank's more likely to go under, because a the banks are using some of this money.

I bet the economic meltdown is due to banks getting rid of the £1.50+ ATM service fee to use another bank's ATM