Why does direct banking not work in America?

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In Europe “everyone” uses bank account numbers to move money.

* Friend owes you $20? Here’s my account number, send me the money.
* Ecommerce vendor charges extra for card payment? Send money to their account number.
* Pay rent? Here’s the bank number.

However, in the US people treat their bank account numbers like social security, they will violently oppose sharing them. In internet banking the account number is starred out and only the last two/four digits are shown. Instead there are these weird “pay bills”, “move money”, “zelle”, tabs, that usually require a phone number of the recipient, or an email. But that is still one additional layer of complexity deeper than necessary.

Why is revealing your account number considered a security risk in the US?

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16 Answers

Anonymous 0 Comments

Theres Zelle, Venmo, and cashapp reslly no reason to trade all ur info when all u need is their phone number or account linked email and u can send w.e in a few seconds

Anonymous 0 Comments

Your entire question is flawed to begin with. Nowhere near “everyone” in Europe uses bank numbers to move money. I’m Swedish, and I haven’t used a bank number to move money for years and years. In fact, if someone asked me to use that here, I’d simply say no. It’s subject to bank day delays and vulnerable to certain scams, while other methods that are easier. We have an app called Swish that lets you send money to any other user of Swish, regardless of bank etc, with no exchange of bank numbers.

I strongly disagree that giving someone your phone number is “one additional layer of complexity deeper than necessary”. Why should I give out my bank number when I can simply give them my *phone number,* which most of them likely have already through either being friends, or from contact for a direct transaction of some kind.

Anonymous 0 Comments

You can give someone money if you know their bank account and routing number, but that’s kind of clunky info to give. By which I just mean they can be 20+ digits. It’s a lot easier just to tell them to send it to ChickenFucker420.

Regarding fraud, I think the fears are blown out of proportion. Anyone you’ve ever written a check to has your full bank account and routing number.

Anonymous 0 Comments

I think regulation in the EU, through PSD2 and which facilitated Open Banking allowed standardisation across the region, which means banks can talk to each other – reducing the need for third party apps.

Anonymous 0 Comments

There are a *lot* of false pretenses in this question.

>However, in the US people treat their bank account numbers like social security, they will violently oppose sharing them.

No, they won’t. People still write and use checks all over the nation, and those have both the account and routing numbers written directly on the checks.

>In internet banking the account number is starred out and only the last two/four digits are shown.

Not on any banking app I’ve ever used, all of my account numbers are proudly on display for anyone looking over my shoulder.

>Instead there are these weird “pay bills”, “move money”, “zelle”, tabs, that usually require a phone number of the recipient, or an email.

It’s just easier. I can remember a friend’s email or phone number a *lot* easier than I can remember their bank account and routing number. Hell, I can remember *my own* email address or phone number than I can remember my bank account and routing number.

As far as paying bills, I pay them directly through my bank’s app, and they send the money directly to the payee in question. All I need is the information exact same info on the payment slip, which includes the account number.

Americans can (and do in some circumstances) use direct banking anytime they so chose, but third-party apps make things a *hell* of a lot more convenient.

>Why is revealing your account number considered a security risk in the US?

As stated above, it really isn’t. There *are* people in the US that are terrified of idendity theft that they *think* it’s a security risk, but that’s more out of their own ignorance than anything else.

Anonymous 0 Comments

American bank accounts do not have separate numbers for deposits and withdrawals, and if you’re going between banks there are often multi-day delays in getting funds moved over.

For peer-to-peer transfers, it’s much safer and faster to go through a third party app like Venmo, Cash App, Apple Pay, PayPal, or Zelle. And, there’s a much smaller chance of errors, because you can either look them up by a memorable name/number or you can scan a QR code to make sure you’re paying the right account.

We do have autopay for recurring charges like rent and utilities. Most big landlords and utilities will have websites where you can put in your account information and set up how and when you want it to be pulled, or you can use a “bill pay” feature in most bank accounts to push funds. I use autopay for *everything.*

The one thing that is VERY rare is credit card transaction fees on top of your purchase total. Some places give a discount if you pay in cash, but I have never seen a place give a discount online for paying by ACH (which stands for Automated Clearing House — the system that handles direct bank transfers).

Anonymous 0 Comments

Here is another layer of fun for you. If someone comes into my bank and wants to deposit money into my account, they need to show ID and be on the account. You would think… let anyone put money in my account who wants to, right? But this indeed where scams can happen.

In the case of the money transfer you are talking about it might be something like they move money in, contact you and tell you it was an accident and to please send it back. Being a nice person, you do. But they already started the process of reversing the transaction and at the end you are out the money they gave and the money you sent back.

That is a really simplistic one, but it shows the concern.

Anonymous 0 Comments

Speaking as an American — remembering your routing and account number is not easy and I don’t know anyone who has it memorized. It’s just not practical to give out to people to settle a tab. Apps like Venmo or Cashapp help fill that space and are very frequently used.

Also, I don’t think I’ve met anyone who is “violently opposed” to sharing them.

Anonymous 0 Comments

And then there’s the UPI system in India. Scan a QR code, pay and go. Bank account to bank account. I haven’t written a cheque in six years, haven’t used cash in over one.

Anonymous 0 Comments

Pretty sure there were lawsuits in Europe stating that it didn’t cost banks any extra to transfer to other banks so they got rid of the fees. In the US they don’t regulate private business as aggressively, so because the banks don’t have to do extra work, they don’t. That let other independent apps take over. In Canada you literally just send money to someone’s email with a question and answer.