Other countries laugh at us when we talk about the checks we have to write, the scams we endure with mistaken payments / withdrawals without our knowledge, or the fees we accept banks charging us.
We would never choose to have the system we currently do. We need to get over the interests / lazy inertia holding us back.
Checks are increasingly rare in the US as well. Ask someone under the age of 25 how often they write a physical check to someone who isn't their landlord. (And even many landlords are starting to accept other forms of payment these days).
Personally, I don't think I've written a physical check in at least five years, except to my superintendent (holiday gift - I don't want to send cash by mail, and it's the one time that a physical check is actually the most convenient way to pay someone).
> the scams we endure with mistaken payments / withdrawals without our knowledge
SEPA, which is what is used in Europe, is actually vulnerable to mistaken payments and similar scams as well. It's faster than ACH, but it's just as easy to send money to the wrong recipient (and just as difficult to rectify if that happens).
In the US, people can withdraw from your bank account if they have the numbers. And it's on you to detect and report the fraud to get it reversed.
In the EU with SEPA, there's roughly the same functionality but with the memo, and that is the standard way to pay for things, without any third party billing platform being in the middle.
Half trolling.
Single Euro Payment Area wire transfers are always free, by the law.
Naturally banks need to make profit, but it is prices little bit more transparently as monthly fees.
Actually, the law is that SEPA transfers cannot cost more than a national transfer.
National transfers happen to typically be free.
I'm probably ambivalent about a "public" banking system, but this comment seems to ignore that we quite literally do pay for using streets in the form of taxes (indirect) and tolls (direct).
However, what NYS is proposing is distinct from an open payment system. This is a closed parallel system of exchange which serves as both a bank account and a payment system. I don't get how this will be better than providing low-cost bank accounts to the unbanked and then providing an easy payment system on top.
Or perhaps requiring banks in NYS to provide free accounts to those whose income is below a certain threshold. Certainly another way to bell the cat rather than creating an alt-currency and a ledger.
[1] https://www.bloombergquint.com/business/can-indias-upi-becom...
(edits: grammar)
Additionally, the central bank already runs a vendor neutral bank account transfer infrastructure called NEFT which recently became 24x7. UPI just happened to be mobile first and we had enough underlying infra to support such a thing.
And "force" is more hyperbole. It goes without saying that the banks will not pass up the an opportunity to add a significant amount of cash to their reserves, and will lobby heavily for it.
Among my friends, it's the way to pay for e.g. your share of the take-out, or pooled office gifts.
> People who are unbanked often cite distrust of the banking system, lack of access to government-issued ID, or inability to maintain a minimum balance as reasons they don’t have bank accounts.
Seems easy enough to me. Make government-issued IDs free, make account minimums illegal for FDIC insured banks, and if you don't trust banks, you have nobody to blame but yourself (plus, if you don't trust banks, why would you trust gvmt-venmo?). These fixes would also address a lot of other problems (voter ID issues, other negatives of not having a bank account)
Well, the banks made a pretty good case for why they can't be trusted in 2008.
That doesn't mean I don't use a bank. It's just not practical to go without one, and I trust the government-backed insurance of my funds for when the bank fails, but I don't trust the banks themselves one single bit.
If the bank fails because they just mismanaged handling the money, that I'm sure the insurance will save the day for the customers. The Feds will come in, check the books and figure out how much each depositor should have and cover them.
But what happens if the bank fails for more malevolent reasons? Say state-sponsored hackers from somewhere that is pissed off at the US hacked in to a bank's back end systems and installed malware that corrupted the backups for a few months and then finally deleted the online records.
Does the insurance apply there? How do the Feds figure out how much everyone gets?
I'm also pretty sure I didn't need to show an ID when signing up for a capital one 360 account online.. so even the ID thing is a stretch. but sure, I might accept not having an ID as a valid reason since you may need it to use your debit card and probably will for checks.
Europe figured this out years ago; it's called a SEPA transfer.
If there was a sort of begging venmo app where you could donate money, but it only worked up to a certain limit each day, then at least you’d know the public was not being exploited by professional beggars, and genuine beggars would see a bigger share of the public’s generosity.
It could even go further and show what the money gets spent on (in aggregate), so we could definitively answer debates like whether beggars spend all their money on drugs/alcohol.
Even with cash, in the vast majority of cases you physically hand over the cash to someone you can see at a location you can return to. In the event of a transaction for physical goods at least you have the good in hand, and in the event of services thanks to government regulations most expensive services require licenses so you can later find the person who failed to perform the service you paid for in cash to your satisfaction. Also, one can create an actual, literal, "paper trail" by requesting a physical receipt-- one that serves as evidence of the exchange and would ideally contain contact information.
With your un-named payment system, can I do a "charge back" if I order some totally legit good or service from an unknown actor in an unknown location in the event of the non-delivery or fraud?
Also, no payment system that requires an internet-connected device (and a powerful one at that if no third parties with the ability to store and process large amounts of transaction data are involved) will ever, ever, despite the protestations of its acolytes, between now and the heat death of the universe, ever be able to serve the unbanked.
That why with the IVL part of the proposal is a physical card that can be used, if a patron is poor and unbanked and does not have an internet-connected device, to transact with the ledger via a trusted intermediary.
Escrow systems are inherently a second layer atop a currency. The "issuing authority" of a currency does not engage in such dealings with the users of the currency; these arrangements are made by the seller (or a palatable third party on the seller's behalf) or by the buyer (or a third party contracted by the seller, e.g. a credit card company).
With the "un-named payment system", escrow is entirely possible and has been successfully set up in many instances, most notably on popular darknet markets. A type of protocol-layer escrow is also possible, by the way, through the use of multi-signature transactions.
> payment system that requires an internet-connected device
This is exactly what the OP article is proposing to build, and what these comments are discussing.
> no third parties with the ability to store and process
SPV and other "light" wallets that remain cryptographically verifiable and decentralized without needing a constant, high-bandwidth connection exist and are, in fact, the default option for most people.
This is a form of insurance and someone could sell this service on the un-named payment system. This business would be profitable as long as most transactions are legit, and part of the profit would be used to reimburse bad transactions.
So yeah I'd trust NSA lending its talent to securing our payments infrastructure over some of the people that were in that Google thread that got paid 300k to do hardly any work in years. But this is a false dichotomy.
I agree it would be terrible if the govt ran it, but would make sense is for the govt to actually plan it and put regulations around it. Provide a framework for private companies to work off of.
the defensive NSA guys would probably be blamed post-facto in some sort of delicious intra-organizational bull-bleep.
So if one day Bitcoin becomes the norm, do you believe it has be handled by the government? If you think so, how do you think the government will be able to enforce that?
The more I see this meme, the more ridiculous it seems.
The US federal government, the overall governing body of the most powerful nation in the world, employs 2 million people in around 1,760 agencies and manages nearly 1 Trillion dollars. If anything it touched "became a disaster", it would not be able to support the most powerful nation in the world, supporting the world's largest economy by GDP.
States are not the federal government, but they generally follow it as a model, and they generally do a good enough job at managing themselves that everything they touch also does not become a disaster.
This is a common trope propagated by big-business interests, but it's not borne out by evidence. Giant corporations have proven remarkably apt at being hacked and leaking private data.
Big business is bad but big government is bad too.
Actually they'd do it regardless of whether it was built by the public or private sector.
I'm in the DC area – so I know exactly how bloated and utterly incompetent most defense contractors are (I worked for a couple). So I have nearly zero faith in them doing a better job.
If you read the white paper, which apparently nobody else did, they say (paraphrased) "Look, this thing is online but we recognize that not everyone has a computer or cellphone so part of the system is a physical card like a debit card that poor people can use".
At the time EMV ("chip-and-pin") was first rolled out across most of Europe, cardholders were actually liable for card-present fraud on their cards, whereas they had not been for magnetic stripe card-present fraud. It took a few years for the EU to pass a law changing this. In the meantime, chip-and-pin was actually a downgrade from the customers' perspective.
My point was that you can't say the government would mess it up when the government (really, many governments as I outlined above) has done a phenomenal job of training many of our best private sector hackers.
That's very different from saying that the government's core competencies include developing and operating secure consumer-facing web services that are also convenient to use.
There's a very big difference between having the raw resources and actually executing.
I live in the DC area. If you think that your average government contractor would do a much better job, you'd be shocked.
What does centralized (and politicized) regulation do better than then free market?
If it's "for-profit", monopolistic, and run by the government, it means:
1. your money is taken away from you through taxes
2. a service you may or may not want is implemented
3. a 'target' for 'profitability' is set, which makes no sense given there's no price system directly attached to the services
4. 'targets' are delivered by cutting edges so that public workers demonstrate enough competency to justify pay raises