Comment by cempaka
3 years ago
Isn't it the case that you still have to have a relationship with a bank to have an account to transfer into or out of via FedNow in the first place? In that case I don't think this would change the picture at all. It's not the intention to help the unbanked pariahs, that's for sure.
There are still almost 5k banks in the US. Unlike Zelle, if this opens to all of them, all you need is one bank.
One low quality bank?
Bank gets bailed out? That's a dire sign for the fundamental value of the dollar to regular people if this is a regular practice.
Bank gets bought up? Well we don't really have 5k banks anymore do we?
> Bank gets bailed out? That's a dire sign for the fundamental value of the dollar to regular people if this is a regular practice.
"Our insurance system works" is not a bad sign for your financial system.
I presume the system uses bank account and routing numbers? So besides concerns with sharing that information with the public, concerned citizens will figure out who they bank with, and will most likely be able to easily pressure the bank to drop them.
Certain things should be difficult to accomplish in a functional society anyways, and administering a profitable hate group is one of those things. If not bankrupted by their lack of credit card access, they'll eventually run into legal troubles from the damage they cause to innocent people.
> they'll eventually run into legal troubles from the damage they cause to innocent people
Which is how this sort of thing ought to be handled, in stark contrast to "Chrystia Freeland sends an email to the heads of major banks to get troublemakers debanked with zero transparency or due process."
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>concerned citizens will figure out who they bank with, and will most likely be able to easily pressure the bank to drop them
This should be difficult to accomplish in a functional society.
Nobody on KF is innocent. You talk like someone who has a thread about them
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they're not a "hate group," they're a "collecting embarrassing info on creeps" group. of course the creeps aren't happy about that, and frame it as "hate."
I'm sure British loyalists circa 1776 would have agreed with you.
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Yes, one doesn't have an account with a participating bank in order to receive and send payments via FedNow. It is same with Zelle; with Zelle, one sends money to an email or a phone number of an intended recipient. Both senders and receivers of Zelle need to registered with Zelle from their banking apps. USBank and Chase are notorious to close accounts who use Zelle heavily, because they see such activities as nefarious. Maybe, other banks use Zelle transaction history as another point to in order to debank people.
I don't want my banks to know who I send money to via Zelle; but they do. If banks are happy with customers writing checks to 'problematic' people, why they think that frequent Zelle activity as source of risk, as long as customers are not depositing or withdrawing cash/money orders.