Quick Banking transfer Question

[scottybuzz]

How come when I transfer funds from one account to another it takes 4 days?

I mean this is online I am doing it. I didnt go into a bank and fill out a paper form to get transfered to head office or anything. I dont understand, surely with todays technology it should be instant(like sending funds to someone on paypal or epass), yet it tells me it will take under 4 days for the funds to get transferd.

I remember hearing from a friend that the bank does this because they can hold the money for themselves to invest with etc. but I dont believe him as surely the competition of other banks would cut the waiting time in order to get the business of those who do not want to wait.

Could someone shed some light for me please?

[scottybuzz]

http://www.gfy.com/showthread.php?t=748646

I have just seen this thread, could my friend be right that they like to earn interest on the money?
So the same applies for major banks?
In which case, which bank pays the banks interest.

Obviously with that question I am in way over my head, so a simple answer would be nice.

[Rhesus]

There's an ongoing interbank money market, for one.

[buzzy]

this is normal for all banks.....or if its a not so huge amount you can withdraw, go to your receivers branch and just put it in the account and its instant

[ztik]

Its not normal for all banks, you bank at mcdonalds or something?

ABA transfers are instant and 100% automated.

The bank is holding the money for some reason. Verification,investing, who knows what else..

[scottybuzz]

Thanks all so far.

What I want to know is what is that "some reason"

Why do they need to "verify" or "investage" every single transfer?

[Vick!]

How come when I transfer funds from one account to another it takes 4 days?

I mean this is online I am doing it. I didnt go into a bank and fill out a paper form to get transfered to head office or anything. I dont understand, surely with todays technology it should be instant(like sending funds to someone on paypal or epass), yet it tells me it will take under 4 days for the funds to get transferd.

I remember hearing from a friend that the bank does this because they can hold the money for themselves to invest with etc. but I dont believe him as surely the competition of other banks would cut the waiting time in order to get the business of those who do not want to wait.

Could someone shed some light for me please?

In my country, if its transfer between same bank and different accounts. Its instant.
But if its between different banks, it takes some time. I guess because they do not want free-flow of money (and fraud prevention) and post the transactions manually.

[scottybuzz]

Thanks Vick!, fraud protection sounds most likley... but then dont people fraud between the same bank?