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nobbie48

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Imagine a two lane street where the west bound traffic had a 300 MPH limit but the east bound lane was limited to 1 MPH.

You go to the beer store for a six-pack on your credit card and it's on your card account before you get a sip of the suds.

You transfer the price of the suds from your bank account to your credit card to zero it out and it takes four days.
 
nobbie48 said:
Imagine a two lane street where the west bound traffic had a 300 MPH limit but the east bound lane was limited to 1 MPH.

You go to the beer store for a six-pack on your credit card and it's on your card account before you get a sip of the suds.

You transfer the price of the suds from your bank account to your credit card to zero it out and it takes four days.
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Stealing all the money for a few days gives them billions in capital to lend out at zero cost.
 
I was wondering when this all started. I recall not too long ago that as soon as you transfer the funds your balance owing should reflect it. Now when I log in two days later I see my credit available is lower by the same amount of the purchase even though I transferred the funds two days prior.
 
My top-level bank account required me to keep $30K or higher in my bank account to avoid any fees or other costs.

I just got the notice that they've changed the minimum to $100K. That includes any TFSA, GIC or RRSP account you might have, but I don't do that with the bank, I have a private manager for it. Grrrrrrrr...
 
nobbie48 said:
Imagine a two lane street where the west bound traffic had a 300 MPH limit but the east bound lane was limited to 1 MPH.

You go to the beer store for a six-pack on your credit card and it's on your card account before you get a sip of the suds.

You transfer the price of the suds from your bank account to your credit card to zero it out and it takes four days.
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To be fair, they do float you funds interest-free for up to 30 days, while the charges sit on your credit card.

As for the lag in accounting, credit card companies are a separate organization from the banks. Even though you may hold a Royal Bank Visa, it's still two companies in collaboration offering you that card.

When merchants process your credit card, it's done entirely on the CC's payment gateway systems and is done as much in real-time as possible and per transaction.

When you make the payment from your bank, the banks saves up all these and other transactions from all their customers and processes and forwards it to the CC company in batches - often not daily and subject to business days and weekends.

Yes, it's slow and antiquated - a by-product of a decades-old process that's only been computerized but not really modernized. You're not the only one that's frustrated. The EU has mandated that banks update their batch-processing systems to real-time. It's called the Instant Payments Regulation - estimated completion time for most US banks is 2028.
 
Lightcycle said:
To be fair, they do float you funds interest-free for up to 30 days, while the charges sit on your credit card.
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In that case yes, there are many parts to the value proposition. If I am transferring money from account A to account B at the same bank, it can still take days and the bank has provided no value. Transfer from Bank C to Bank D is even worse and again, they provided little other than facilitating a slow transfer.
 
nobbie48 said:
Imagine a two lane street where the west bound traffic had a 300 MPH limit but the east bound lane was limited to 1 MPH.

You go to the beer store for a six-pack on your credit card and it's on your card account before you get a sip of the suds.

You transfer the price of the suds from your bank account to your credit card to zero it out and it takes four days.
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What bank? Transfers are usually instant, bill payments are recorded the next business day.
 
GreyGhost said:
If I am transferring money from account A to account B at the same bank, it can still take days................
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What bank is this?

I'm with CIBC. Online transfers back and forth between a checking account and a savings account occurs immediately.

A transfer from checking or savings to my CIBC MC can take a few days to be posted.
 
ReSTored said:
What bank is this?

I'm with CIBC. Online transfers back and forth between a checking account and a savings account occurs immediately.

A transfer from checking or savings to my CIBC MC can take a few days to be posted.
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Cibc happens instantly (Chequing<>LOC). Scotia goes to pending instantly and then takes days to transfer from pending to complete (Investment>HELOC). Rbc removes money instantly and adjusts receiving balance in a day or two (Chequing>cc).
 
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CIBC is not immediate when paying my CIBC Visa from my CIBC account. Maybe a day or two.

Funny story, I paid my CC and looked the next day.... the balance was still there, I thought maybe I didn't pay it so I paid it again. Then a few days later I looked again and saw the same number! I thought I was going senile so I paid it again (what I did not notice was the negative sign in front of the number the third time). Paid it three times...
 
GreyGhost said:
BMO holds it for a bit before they give it to CIBC.
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There’s 2 ways to make a credit card payment at a bank.

If you do a bill payment online or at an ATM, the payment will arrive next biz day by 11/am as it passed thru the banks general bill payment system which settles payments once a day between midnight and 5:30am ET.

If you pay at teller or using telephone banking specialists, the payment will be faster - minutes to hrs - these are credit card transfers between banks that get settled many times a day. *** note: branch tellers might not use the transfer system (lazy or untrained) telephone bankers will always always get it right. ***

In both cases you need to make the payment on a biz day before the cutoff - use 6pm to be safe (it varies bank to bank but never sooner than 6pm). If you’re late, the payment is settled next biz day.

There is a lag of 1-3 days between when the payment is credited and posted. This confuses people and most bank tellers too. Always check check available credit - it is updated in realtime.

Now there are exceptions. If your account is over limit, delinquent, in high interest mode, or has seen fraud in the last 24 mos, your payment may get delayed as banks do additional work before crediting accounts in those situations.



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Mad Mike said:
There’s 2 ways to make a credit card payment at a bank.

If you do a bill payment online or at an ATM, the payment will arrive next biz day by 11/am as it passed thru the banks general bill payment system which settles payments once a day between midnight and 5:30am ET.

If you pay at teller or using telephone banking specialists, the payment will be faster - minutes to hrs - these are credit card transfers between banks that get settled many times a day. *** note: branch tellers might not use the transfer system (lazy or untrained) telephone bankers will always always get it right. ***

In both cases you need to make the payment on a biz day before the cutoff - use 6pm to be safe (it varies bank to bank but never sooner than 6pm). If you’re late, the payment is settled next biz day.

There is a lag of 1-3 days between when the payment is credited and posted. This confuses people and most bank tellers too. Always check check available credit - it is updated in realtime.

Now there are exceptions. If your account is over limit, delinquent, in high interest mode, or has seen fraud in the last 24 mos, your payment may get delayed as banks do additional work before crediting accounts in those situations.



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My concern is the card getting interest charged even though the payment was made before the due date
 
nobbie48 said:
My concern is the card getting interest charged even though the payment was made before the due date
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There is a small grace period between payment date and settlement date. The banks and credit cards have accounted for the delay between the two.

I've often made a payment a day or two after the due date and never been charged interest.

If you do make a payment on or before the date and you get charged interest, a quick phone call will get the interest charges dropped.
 
Lightcycle said:
There is a small grace period between payment date and settlement date. The banks and credit cards have accounted for the delay between the two.

I've often made a payment a day or two after the due date and never been charged interest.

If you do make a payment on or before the date and you get charged interest, a quick phone call will get the interest charges dropped.
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That's good to know. I always pay everything at least a few days early to avoid the kick in the nuts of 30 days of interest for being a day late on payment.
 
nobbie48 said:
Imagine a two lane street where the west bound traffic had a 300 MPH limit but the east bound lane was limited to 1 MPH.

You go to the beer store for a six-pack on your credit card and it's on your card account before you get a sip of the suds.

You transfer the price of the suds from your bank account to your credit card to zero it out and it takes four days.
Click to expand...
I see you did not mention the "cash back" you got from paying off the amount before the end of the grace period.
When I was a young socialist I was all for nationalizing the Banks!
As I got older and learned how the world works I bought shares in the same Banks.
 
Do any of you know why is it that when I deposit monthly/recurring cheques at my BMO Home branch, it gets processed/released the day of.
But when I go to any other BMO branch, they make me wait 4-6 days?

I've asked my home branch about this and they didnt have an answer. I suspect it is just because they know me since 2008 and have that trust factor but do not want to admit it lol. Strange...

I had another teller tell me that there is an initiative to get rid of/ phase out paper cheques so they may be introducing a mandatory 7 day waiting period soon?

And to GreyGhost/Mike's point - agreed, the transfer method appears to reflect online much quicker vs the biull payment method that take atleast 1.5-2 business days to reflect.
 
POWERMAN said:
Do any of you know why is it that when I deposit monthly/recurring cheques at my BMO Home branch, it gets processed/released the day of.
But when I go to any other BMO branch, they make me wait 4-6 days?

I've asked my home branch about this and they didnt have an answer. I suspect it is just because they know me since 2008 and have that trust factor but do not want to admit it lol. Strange...
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Tbh, I haven't been to any of my home branches in a decade or more (more than two decades for my main chequing account). I deposit everything with a phone. Cheques all get held for me but the banks let me access part instantly (3-10K depending on bank). Etransfer or wire has no hold.
 
GreyGhost said:
Tbh, I haven't been to any of my home branches in a decade or more (more than two decades for my main chequing account). I deposit everything with a phone. Cheques all get held for me but the banks let me access part instantly (3-10K depending on bank). Etransfer or wire has no hold.
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I keep getting those BMO emails prompting me to do online banking via my phone. But the problem is I dont trust my phone.
I've only ever used my home computer for online banking and go to the bank branch as much as possible for other queries/transactions. Too old fashioned despite working in technology XD.
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