Has it occurred to any of the readers of this 'blog to wonder why banks have not, for a long time, printed either the name of the payee against cheque numbers or the name of the payer(s) against credit numbers when they produce statements. It's not as if this information is not readily available in an electronic form - the payer's bank has to know who the money is going to so that they can pay them the money and the payee's bank, in the case of a credit, has to know from whom the money is coming- so why not put it on the bank statement?
The only reason I can think of is that, if they did it routinely, they wouldn't be able to charge you for doing it, but then it's not a service any of my banks has ever offered me.
Tuesday, 25 January 2011
Another Question
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12 comments:
Can't say I've ever noticed but I have noticed various reductions in services which then means the process time is doubled.
I can't honestly remember them ever routinely doing it. When did it go out of fashion? They still tell you to whom the Direct Debits go, from which cash machine you've withdrawn money and so on. But people hardly use cheques any more (I use a dozen a year, maybe and receive as many).
Idleness? Shear blind cussedness? Crass incompetence? Because they are wankers? What do you expect from a rent seeking state sanctioned cartel?
Mark, I can't remember them doing it either, but my mother can, and she's eighty, so it was a long time ago, when overdrawn balances were printed in red, too. I don't use cheques much either any more, but it's still a pain, having to make sure you fill out and keep the stubs.
And if they can do it with card purchases, direct debits and the like, why not cheques?
Oh do try to keep up, peeps.
Cheques are handwritten or printed, which means it's essentially analogue information. The merchant or recipient pays it into his account, sure, but all that's captured electronically is the cheque number, account number of the payer's bank, and the amount of the cheque (which is - or certainly used to be - encoded in a labour-intensive process by someone keying the amount into a machine which prints the amount in OCR in the lower right corner.
The electronic record of machine-readable information goes off to allow the bank to distribute credit and debits between its branches and other banks, and settle up. (It used to be that the machine encoding the amount would read the OCR and sort the cheques into hoppers for "own" and "other" banks. The cheques were then bundled up with a tally-roll listing of the amounts for reconciliation and sent off for re-reading at the clearing centre).
The paper cheques are collected by courier and sent to the clearing centre where they're scanned and probably destroyed these days - in my day, they were returned to the drawer branch for checking of signature, correct filling in etc.
The payee detail is completely irrelevant for the purposes of settlement, and the security aspect (making sure I don't pay the Widow Bogey's pension cheque into my account) is dealt with by the receiving cashier.
So the payee details are never captured, and can't be reproduced on the statement; only the cheque number, and amount.
Bayard's mother remembers the days when statements were produced manually by people with typewriters (the old fashioned sort) or statement-printing machines which were essentially big typewriters. You used to get your cheques back in those days, too.....
Lola is being slightly unfair since there's no way of reliably reading handwriting, and he'd probably be the first to complain if banks spend ages laboriously typing in payee details for every cheque.
And do keep in mind that cheques are a 19th century technology in decline - refinement isn't worth building into the system in these days of debit cards and payment authorisation.
In the US my bank used to attach a second page to the statement that had copies (front and back) of any cheques paid in.
Seemed like a waste to me, but I am not a big cheque user.
FT, is there and has there not been for a long time, no electronic link between the account number and the account name (as held by the bank, that is, not the approximation-to-the-name-written-by-a-pissed-semi-illiterate as written on the cheque)?
I appreciate it takes a human to read a name off the cheque, and I know, from having a friend with an account with a bank that actually bother to do this, that that is what they do, from the various versions of my name that appeared in his statement.
B: there is indeed an "electronic link between the account number and the account name", so I don't see a practical reason why they don't do it. It can't be harder than telling you from which cash machine you withdrew money.
Further, putting the names on would be an anti-fraud measure in its own right, so even if it cost banks a tiny bit of extra time putting the names on, they could at the same time automate the whole cheque process (scan the things in by OCR and hope for the best), the few extra mistakes that come in would be more than outweighed by the fraud that can be reduced.
Bayard, yes, there is an electronic connexion, but not a direct one. Part of the servicing issue banks have (or, again, that they had when I worked for one) is that the system they had were batch-processing, with different systems of different ages running different account types.
Hence the big buzz in banking software (in which I also worked) being the fabled "Customer Database" in the 80's which would unify all those legacy systems and give the banks a "Single Customer View". Trouble is, it was so costly a solution that it wasn't ever pursued to its logical end (AFAIK).
I'm not defending the banks or their systems; just pointing out that the reason they don't offer the solution is that it's always been to all intents and purposes too costly to implement. And with cheques finally in their demise, they surely ain't going to implement it now.
As your mother observed, it was in the dim and distant past not an issue because you'd get your cheques back with your statement. What killed that was the opening up of bank accounts to the great unwashed (ie the rest of us) in the early 60's as employers tried to reduce costs of paying in cash. Suddenly, there were millions more accounts and so cheques and credit floating around; that is (maybe was) where today's legacy systems had their roots.
In the area I work in now there's chaos because of the number of takeovers between banks, and their now having to unify their administrative and systems differences - because the legacy systems underpin the whole thing.
Whether you think that's incompetence or wringing the last drop of value from their investment over 40 years is, of course, up to you. I'm not attempting to excuse anything or anyone.
Cash machines, by the way, work on different systems purpose written in more recent years and so able to carry the information. The cash machine networking and communications isn't undertaken by the bank which owns the machine; someone like VISA, Maestro or FIS will carry the data traffic for authorisation and settlement. That's how interchange fees are able to be paid which has spread the ATMs themselves far and wide. The account-holding bank just receives a file of information to run against its accounts.
"Whether you think that's incompetence or wringing the last drop of value from their investment over 40 years is, of course, up to you."
Sounds like computing industrial archaeology to me! Thanks for that info, I can stop wondering now.
Following up ADB's comment, I hold a US$ checking account with a large domestic US bank. I receive monthly statements and, as ADB notes, a photocopy of all cheques I've issued. I can also download the same images from the bank's website. I have many criticisms of US banks (don't make me start) but finding out who cheque payees are is not one of them.
Also, closer to home, when I deposit cheques by machine at my local HSBC, I receive a photocopy of the cheque(s) deposited - so no complaints there either. Sure our banks (and US banks) can give crap service - particularly when something goes wrong - but they're not completely crap.
computing industrial archaeology
Fortunately, no sign of Tony Robinson. Just, perhaps, his only-slightly-less-famous relative, Heath.
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