Balancing my check account
Posted Sep 14, 2005 12:47 UTC (Wed) by MortFurd
In reply to: Balancing my check account
Parent article: The Grumpy Editor's guide to personal finance managers (Part I)
Businesses still pay with checks because there are still people who don't have bank accounts.
Also, the phrase "balancing my checkbook" has sort of gotten stuck in the American english language. It means balancing your bank account.
Many people do use credit cards and debit cards to pay their bills and purchase things at the store and don't use checks much at all.
Also, using a check gives me immediate control of what is going on with my account without depending on the bank. Balancing a checkbook is a check to see that I've managed my money properly, but it is also a check to see if the bank is doing its job properly. If you blindly trust your bank to handle your funds, and an online check of your balance make you happy then fine. Some people would, however, like to do the arithmetic themselves and be certain.
Considering how online banking runs (think of all the phishing going on,) I would not want to do online banking in most countries. In Germany, I feel pretty secure about it. I use HBCI (with GNUCash) to pay my bills and check my balance.
HBCI uses a smart card to encrypt and decrypt communications with the bank. Only the bank's server and my card have the correct keys. GNUCash sends an encrypted packet that claims to be from me to my bank. The bank server pulls up my key and tries to decode the packet if it succeeds, then I am me and the bank does what ever the packet says (bank transfer, balance request, etc.) There could potentially be a weak spot in the encryption (or someone could steal a truck load of backup tapes with the keys,) but all in all much more trust worthy than https and a PIN. The bank is sure who I am, and I can be pretty damn sure that I'm talking to the bank since they encrypt their responses as well.
Lacking a truly secure way to do bank tranfers from home or from the office, I can well understand why businesses would stick with checks.
Also, I've never understood the advantage of the paper bank transfer forms. To use one, I must go to the bank to pay my bills. In earlier days, this was free. These days, most banks charge for handling the paper form. As an alternative, they let you use a terminal in the lobby for free to pay your bills electronically - but you still have to go to the bank to do it.
With checks you can hand them to the employee, or you can mail a payment to whoever. Bank transfers (if you don't have trustworthy home banking) requires a trip to the bank.
to post comments)