Hacker News

That is indeed correct, and I'm sorry for framing the 6% rate as if it were the overall general rate.

> Attracting strong talent in Canada is hard given the massive pay differences gained by moving south of the border.

The size of the pay difference is something you, as the prospective employer, have significant direct control of. It is within your authority to point the dial anywhere from "hard to find anybody because of the massive pay difference" to "easy to attract strong talent, while still saving money relative to what it would cost to attract the same level of talent in the US".

The Canadian business establishment will not come after you to break your knees if you offer higher wages than they do.

US hi-tech companies opened branches in Canadian cities. Used to be for H1B hopper but no longer the case: they have been expanding their footprints.

I was actually pleasantly entertained by this movie, despite the inaccuracies. Loved to see the rise and fall and not just rise and conquer that so many biopics portray today.

This is bizarrely self-contradictory. Pay differences are high because in fact there's a glut of talent.

I've worked for many companies over the years that chose to colocate here because of the relative ease of finding talent.

And there's plenty of good talent that doesn't leave. Because we don't want to. Home is home.

There's also lots of us who work remote for US or EU companies these days.

(Blackberry movie also is garbage)

>because so much internet infrastructure presumes that's where you'll be and only handles Canada as an afterthought

Which internet infrastructure is an afterthought in Canada?

HQ in San Francisco, but everyone works in Canada. That's a reasonable model.

And Europe is now doing the same, by integrating all the weird local methods that EU countries have come up with into one unified local system.

I have long felt that this is true of much of the western world. The conservatism of investors vs the US must be one of the biggest reasons for US advantage

Now just define “any value”, and that’s a uniquely valuable comment!

Money is fungible; the funding can come from anywhere. Heck, these days it's not uncommon for Softbank in Japan to invest money from Saudi Arabia into companies in California.

Canadian investors are much too risk-averse, but they will happily follow a funding round led by an American VC.

The trend has been for Canadian startups to find funding outside of Canada. With Cohere the government appears be trying to alter this.

Does it have to be Canadian investors though? Why don't Sequoia et al invest in Canadian (or Japanese or German) companies directly? I'm aware that many VC firms have a foreign presence and I'm not talking about that.

It's always struck me as a little weird that a company has to be within driving distance of Sand Hill road to get attention from a Silicon Valley VC. VCs can't hop on a flight to do some due diligence? Video conferencing isn't good enough for monthly status meetings?

You conveniently missed GP's follow-up sentence:

> FedNow exists but is supported by handful of banks which charge fees to use the feature.

What good is inventing a feature if almost nobody can use it?

To be fair, SEPA instant payments only became mandatory late last year too.

The big difference is that the EU has mandated (effectively) fee-free availability to all end users, while the US is only making it available as an infrastructure layer. Most banks don't bother offering any product on top of it, or own-account-transfers for a fee at best as mentioned by GP.

For nearly 20 years the UK has had "faster payments", free instant transfers, now up to £1m, and while you can't send to a phone number, the routing numbers needed can't be used to withdraw so are generally safe to give to people.

Has it actually helped anything? B2C is still all credit card or (due to some weird regulation) cash because of the credit card fees being passed on.

Even before that Australia had bank transfers, the US had Paypal and now Zelle.

Others have pointed out that we do have this and there are some reasons it's not the same scale as credit card infrastructure, but I'll just observe there's a cultural difference

We've had a billion discussions on Hacker News about payment rails and it's invariably always a European incredulous that Americans can't/won't do a digital payment instantly and for pennies. These Europeans are typically operating with a mental model where they have cash in a bank account and every transaction gets funded from cash on hand.

Americans - for better or for worse - want longer cycles to pay for their charges and many want rewards for their spend. I don't think it's uncharitable to describe those who pull out debit over credit during a transaction as lower income and higher credit risk than those who prefer credit. (Europeans will decry that this is Americans living beyond their means. Maybe! Maybe.)

But when it comes to business, I've never understood this argument from Europeans. Invoicing works on net-30/60/90 terms. In B2B payments you could reduce payment cost by doing invoicing with instant low-cost payment in 30 days, but incur a different "cost" in cash flow management. Credit card payments are a risk-based financial product that does a magic trick of arbitrage for merchants between a service/good sold and payment received as a net-30 invoice to the cardholder, and you should expect to pay a fee for that. An economy where businesses need to pay each other immediately out of cash-on-hand is less dynamic and less efficient than one where all that cash flow can get smoothed out via payment intermediaries. (Money you have to keep on hand for bills is not being deployed doing other things in the economy - this is inefficient!)

For C2B payments, this is probably a helpful and lower-cost innovation over debit rails. But credit is a different product, financially and culturally, in the United States.

Mostly the curse of the first mover, with a dash of corruption for spice.

Part of it is "the curse of good enough": the US has had good credit-card style infrastructure for over a century and digital infrastructure since the POTS days. Part of it is that we lost our appetite for anti-trust in the 80s. Part of it is that the price structure of this infrastructure has wormed its way into everything in a way that is difficult to undo without causing high-visibility inconvenience for low-visibility benefit. The good-enough is the enemy of the good.

Payment processors and banks lobby for control over this. As usual, a service/product is bad because no one is allowed to create a better alternative, this is an almost universal rule. Specific to this case: the government is included in the list of parties not allowed to make it better.

Mostly deficiencies of the political system: regulators see themselves, call themselves and act like "watchdogs", whereas in other countries financial regulators act like shepherds and lead the market. Hence in this country relatively minor players with interests not exactly aligned with the general public can hijack the process. That's what we are witnessing.

Banks earn money on card payments and pay (via explicit fees or implicit fraud liability without compensation) for interbank transfers, so without any external forcing function (market or regulatory), it seems pretty clear to me why they prefer one over the other.

Not real time, but ACH is being forcibly sped up by regulators. [0]

> All U.S. financial institutions (Receiving Depository Financial Institutions or RDFIs) must participate and accept Same Day ACH credit transactions.

> However, sending (originating) Same Day ACH payments is optional for banks and credit unions.

[0]: https://www.nebankmn.com/assets/files/aijt34yD

Our federal representatives are mostly incompetent and technologically illiterate. When a large project does materialize, the funding is wasted on contractors who actively scam the government.

In most part of the world, the government just force the bank to join the payment system and restrict how they charge the customer.

In the USA, no single regulator have that power. Basically only congress can do something like this. The us Congress ain't famous for being fast, you know.

The Fed prints a fraction of a fraction of the actual money in circulation. Private banks in practice control the money supply. As such, they want to maintain their monopoly.

The countries that have innovated the most in regards to automated payments are the ones trying to escape US influence: look at PIX in Brazil, BRICS pay, etc...

In America, the payment system is an oligarchy, they protect their own (the bankers), what need is there for innovation when they are making a killing out of the current inefficiency?

The one place where the US haven't been slow is in stablecoins, making them dollar donominated, to ensure the monopoly the US dollar has on international trade stays strong. That way, when the US has a crisis, they take down the rest of the world too, to the joy of non-US countries.

I think it’s the general desire for a “smaller” Federal government that instead relies on private sector solutions.

For other examples, look at adoption of login.gov vs id.me, and tax filing software solutions.

It does. Outdated information RTP is what its called

Lobbying?

Venmo, CashApp, Apple Pay, and Zelle are free for person to person transactions and you get the cash in your account the following day.

I’ve never been in a position where I needed a cash transfer to an account the very same day, I have tens of thousands of dollars of credit available so there’s very little need for immediate transfers, at least for me personally. I do virtually all of my spending on credit cards so I have up to 60 days to pay the loan back without interest.

FedNow is still roughly an order of magnitude more expensive than the EU's TIPS (EUR 0.002 vs. USD 0.045, last time I checked) in terms of "sticker price", but yes, at least there's some movement, and as you say I'm not sure who actually pays that sticker price in the US.

The real problem is that, even if costs were to come down to zero, there is nothing incentivizing banks to actually make RTP available to their customers. In the EU, customer-initiated "push" bank transfers are considered an essential part of a checking account; in the US, they're not.

I want to send money between accounts I own in real time. I want to deposit money in brokerage accounts in real time. I want to stop connecting my accounts to services like Wise to make money transfers. I want to pay off a credit card and have that payment clear instantly. FedNow could enable all of this.

Purchases are an afterthought. A system like Brazil's Pix could be rolled out on top of FedNow.

> For purchases, the US has debit cards and Zelle.

Both are a very poor alternative to something like UPI or even EU-style bank transfers as a mass retail payment system. Cards are orders of magnitudes more expensive; Zelle has no standardized interface and is explicitly geared only towards P2P Payments, lest it cannibalizes the banks' golden goose, i.e. payment cards.

> same-day ACH is widely used, and again the delay allows more efficient netting.

Importantly, customer-initiated/"push" ACH is largely not a thing in the US, unlike in many other countries. This is what people unfamiliar with the US landscape often have a hard time understanding.

> A very important point is that debit cards offer consumer protections (chargebacks for unsatisfactory goods). FedNow, Zelle, wires, ACH do not and people have lost money by scams this way.

That's the crux of it: The US seems to be culturally unwilling to accept the risks (fraud) and rewards (practically free P2P and B2C payments) that come with a customer-initiated/push payment system.

Instant for USA banks doesn’t mean instant for USA banking customers, and deposits can be held per fed and banking policies for variety of reasons especially larger deposits. Also, it’s increasingly common to have financial routing intermediaries playing by different rules and non-insured financial accounts that result in no coverage when the money is spent/lost elsewhere and not returned to end customers. Take a look at Zelle case in New York and the nearly $100M customer funds missing with the Synapse bankruptcy.

My point is that these properly designed national systems should also be considered in the USA as well, and not dismissed because something is kind of working right now with a long list of exceptions to a good and safe experience.

Most other countries low value real time systems are also net settled (as opposed to RTGS systems which as the name suggests, use gross settlement).

Is this correct - A very important point is that debit cards offer consumer protections (chargebacks for unsatisfactory goods) - I was under the impression that only credit cards offer chargeback protection?

The Clearing House owns both ACH (automated clearing house)and RTP (real-time payments).

https://www.theclearinghouse.org/payment-systems/rtp

Zelle is pseudo real time. The settlement (mostly/often?) happens by ACH.

https://www.cjsoi.com/articles/fednow-vs-rtp-vs-ach

Why do you argue with fanatics? Even your sensible and informative post gets downvoted.

The networks exist, the product does not.

This is how all real time payment systems work if the recipient institution != sender institution. Credit cards, iDeal, Bancontact, SEPA instant... In the end it's reconciled within the next few days with a pinky promise between institutions the money will actually arrive.

Its already growing on me

I'm very comfortable. Interac purchased and enhanced the SecureKey Verify.Me service and rebranded it as Interac Identity. It's a reliable way of determining identity and eliminating fraud (I helped integrate it into a company's customer sale process which was rife with fraud). This page on the Real-Time Rail shows that it's definitely using Interac e-Transfer https://www.payments.ca/systems-services/payment-systems/rea...

We Canadians love our sexual innuendos in language. Asking someone to rail us would fit in nicely: "I'm fucking the dog, can ya rail me enough for a forty?"

Isn't it legally a bank? It provides chequing and savings accounts (registered and unregistered), and it's even CDIC-backed on at least their managed products.

Wealthsimple is best known for their robo product, not their banking. It's the Canadian equivalent of Wealthfront.

It does say "With additional participants onboarding continually in the coming months, including all major Canadian financial institutions and other members applying for access, the RTR will be available to more than nine in 10 Canadians within the first year after launch."

> This new national payment system will transform day-to-day payments for Canadian businesses and consumers by enabling instant speed and settlement.

It does sound like it's for consumers as well

Of course, if you want to do it through your mobile then your bank can require attestation. No different from now.

For those unfamiliar with the term, a "Crown Corp" is a private company, but wholly owned by the government. It's not an unusual structure here, the BoC is itself a Crown Corp.

To contrast, Interac, the system used for canadian debit and person to person transfers, is a private company, with ownership by the banks.

I thought it was a crown corp too, but I don't think it is: https://www.canada.ca/en/treasury-board-secretariat/services...

If you look at their "about us" section, they just say they are "a corporation". https://www.payments.ca/about/who-we-are Although they were created by a law (Canada Payments Act) and have a public mandate:

Payments Canada has formed a critical part of Canada’s financial market infrastructure for over four decades. The Canadian Payments Association was created by the Canadian Payments Association Act in 1980, now known as the Canadian Payments Act (CP Act).

It's a niggle upon a niggle but I do not believe payments Canada is formally a crown corporation. It's primarily a member consortium / industry governance body, though to be muddied further, Minister of Finance does have some oversight responsibilities / accountability.

I always viewed it as one of the "we will govern and regulate ourself so government doesn't fully have to" bodies, but I'm an outsider so happy to be corrected :).

Interac is not settled realtime - it uses the same infrastructure that was built 50 years ago but has a more modern interface. UPI, Pix and now RTR are new settlement systems that are meant to be realtime from the get-go.

You're correct on the first point, and it's worth adding that Interac is a closed network - Interac has no obligation to let anyone participate, and it's been a pain point in the FinTech world that you either have to convince them to let you in (e.g. Wealthsimple) or piggyback on a banking partner (e.g. most other FinTechs.) Maintaining that banking relationship is a big burden for fintechs, especially if you rise to a level where a bank views you as direct competition.

RTR's membership requirements are set by PayCan, who have a mandate to foster competition. Any FinTech who can meet requirements can, in theory, hold a settlement account on RTR and participate. Interac has an incentive to keep the club small, so to speak, and prevent new up-and-comers from cannibalizing their market share.

From a competition lens, the hope here is that RTR levels the playing field for both the big banks and fintechs and opens the door to a lot more consumer-facing innovation. That will, of course, depend on the network effect and who gets onboard.

> From what I can tell, e-transfers will continue using interac's network, so I'm not sure if this will benefit users at all.

quote from the page:

As Interac e-Transfer payments begin to clear and settle on the RTR, we will put this world-class infrastructure to work for consumers and businesses.” Jeremy Wilmot, President and CEO Interac Corp.

Yes but I'd like if the market had the ability to compete for better money transfer UI/UX than switch banks because their app is mediocre.

Has FedNow had any visible effect in the US? Are bill payments and bank to bank transfers now happening instantaneously?

Thanks for contributing some actual expertise!

What are the provisions for privacy - preventing my every financial transaction, and thus everything I do involving money, from being centrally tracked, and shared with private institutions?

And what about for preventing government from cutting people off from the financial system (without a court order)? Edit: The US government already commonly does it with non-citizens in the context of other financial systems.

At least, how does that work with FedNow if not Canada's RTR?

EDIT: (clarified and reorganized)

Just as long as they don't make him the minister for health. Transport might also be a bit dubious.

> Pretty much every modern phone can do tap to pay, you don't need an iPhone

but you do need a device to read the phone right? to support all kind of difffent payment system. compare to a simple picutre printed QR code, which one is more convenient?

https://en.wikipedia.org/wiki/Payment_rail

"Payment rail" is a very long established term og art.

> > "Payment rail" is a very long established term og art.

> Yes, by all means, use the existing terms internally, but when you launch things, remember you work in somewhat of a bubble, and figure out names that make sense to people.

This is to be used by people in the same bubble, and it does make sense, it's about as descriptive as it could be.

99% of people aren't going to need to touch this. This is underlying infrastructure for banks to build on top of. Most people don't know what a clearing house is or what Payments Canada is or that most of their money passes through them, but they are still perfectly capable of understanding what direct deposit does - which relies on Payments Canada's clearing house.

This isn't aimed at 99% of people. This is an interbank tool.

Agreed! I was thinking, "That's funny, I thought Canada's rail company was called ViaRail".

The name threw me off as well. This is what happens when you don’t have a good marketing team.

I don't think this is as unusual are you're implying it might be.

I've moved funds ranging from 10k to $1m between banks in Canada much more than once, and every single time, I go to one and get a draft and drive that draft over to the destination bank. It's just easier...and its absurd.

While i agree it is uncommon - i disagree that banks get much security value from this. Most banks let you do etransfers from a desktop computer just normally. I dont really see what attacks banning rooted phones stop when you can just use your normal linux desktop.

Yeah what did you need that freedom for anyway?

> You, as a technically savvy user, could choose to use a dedicated device with an acceptable security posture for your electronic transfers.

Not really, I'm forced to use e.g. RBC because that's where my employer sends their matched retirement savings funds.

For the last several months, eTransfers initiated from my desktop browser (Firefox on Linux, same as you) have required confirmation via the RBC app on my iPhone. Definitely seems like they have multiple scales of trustworthiness for people/devices/activity. Kind of wish they'd be more transparent about what they are, but I guess that sort of transparency can easily become a vulnerability.

Similar experience. No real problems. However, RBC limits the amount I can transfer to 2k per day from browser and like 5k per day from the app.

I don't send anything from TD, but if I buy anything online half the time it forces a 2FA which requires signing into the app and confirming the transaction. I imagine signing into the app might not work nicely if I was on LineageOS.

Used to be the case, yes. However even web-initiated EMTs trigger device confirmation. RBC seems to have made this mandatory for at least my account as of this summer.

If you are referring to SEPA Instant, thats not true: It started operating in 2017, though not many participants back then. What happened last year/this year, is, thats its mandatory for banks to offer it across the EU.

No different to a bank transfer. You understand that they cannot be reversed either?

You can't reverse a bank transfer either and payment services such as Zelle are a favorite for scammers and also cannot be reversed either.

So you have not made a point here.

> This new payments system is also ISO 20022, as is Pix.

This is a good step. But the devil is in the details.

And I don't see the details that matter the most:

* Network effects: will it be widespread (from city buses to fruit stands)? Compared to UPI and Pix, Interact has a pathetic history of adoption. What sets RTR apart from Interact?

* Friction: Will it be instantaneous and free of charge? Can it be used by illiterate persons? QR codes? NFC tags?

In Brazil/India those payments systems are used by the most informal of agents: fortune tellers, prostitutes, merchants in crime ridden favelas, ... This is what real mass adoption looks like.