bank account number portability

Random

i was reading something there recently about this (was it on boards?). someone suggested that this should be brought in to open the current account market a bit more, much like it has done for mobile phones.

what are realistically the issues with this being implented do you think?

dotsman

Random wrote: »

i was reading something there recently about this (was it on boards?). someone suggested that this should be brought in to open the current account market a bit more, much like it has done for mobile phones.

what are realistically the issues with this being implented do you think?

It makes no sense.

Your full account number is made up of several parts;

• The BIK identifies the bank
• The NSC identifies the branch
• The Customer Number line identifies you
• The Account Identifier (last 3 digits) identifies which account of yours.

When a transaction takes place, (say you use your debit card, or a direct debit comes out), these set of numbers route through the international banking system to identify the specific account you want the money to come out of.

The sole purpose of an account number is to completely and uniquely identify a specific account within a bank.


Think of it in terms of a landline telephone number.

• The international code identifies the country
• The area code identifies which part of the country
• The remaining digits identify the building and extension number (where applicable)

If you were to move to France and still keep this number, nobody would be able to ring you because, as soon as they dial the first few digits, it sends the call to Ireland, the next few digits sends it to your area, the last few digits sending it directly to your telephone.

Or better yet, it's like suggesting that you should be able to bring your address with you should you ever move house! It makes no sense!!!

Nermal

dotsman wrote: »

It makes no sense.

It makes perfect sense, it would dramatically increase competition in banking. There'd simply have to be another layer in the bank routing system that recorded transfers of bank account number between banks and sent payments to the 'true' underlying account. There was an article about it in the Guardian recently that might have given you the idea?

It would be a massive undertaking though, and cost a fortune. I can see the EZ mandating it at some point in the future. It'll never happen on a national level.

dotsman

Nermal wrote: »

It makes perfect sense

Nermal wrote: »

It would be a massive undertaking though, and cost a fortune.

Do you not see the contradiction?

You're talking about completely rewriting the underlying architecture of bank routing, resulting in a massive cost, large scale confusion, and no doubt a large increase in errors; for what exactly?

How would this increase "competition"? If you want to switch from bank A to bank B it is very easy. You can do it yourself (a few minutes worth of phone calls) or ask the bank to use the switching code. Anybody who is not switching banks now is unlikely to suddenly want to do it just because they can keep their number.

Anyway, we already have massive competition in this country, and too much competition is what got the bank sector into the current mess. I simply don't see how anybody would benefit from this, only suffer.

phormium

I can't see the benefit, account numbers are duplicated by banks anyone so are not individual in the first place, there could be half a dozen customers of the same bank with the same account number, different sort codes obviously.

dublin daz

dotsman wrote: »

Do you not see the contradiction?

You're talking about completely rewriting the underlying architecture of bank routing, resulting in a massive cost, large scale confusion, and no doubt a large increase in errors; for what exactly?

How would this increase "competition"? If you want to switch from bank A to bank B it is very easy. You can do it yourself (a few minutes worth of phone calls) or ask the bank to use the switching code. Anybody who is not switching banks now is unlikely to suddenly want to do it just because they can keep their number.

Anyway, we already have massive competition in this country, and too much competition is what got the bank sector into the current mess. I simply don't see how anybody would benefit from this, only suffer.

Would the same not have been said for mobile phone number portability?

There is no need to have six digit sort codes for each institution.

Some/few banks share 90/93 etc - so therefore sharing is already in place.

It would speed up switching - the hassle people see in switching is a barrier for some, particularly older people.

Of course it can be done. Whether or not it actually happens depends on how much leverage the Banks have. Of course Banks don't want this. One or two might have lost all their fee-paying customers overnight had the switching process been so simple.

JTMan

Great post Random.

The Guardian article on IBAN number portability is here.

The IBAN number does not need to be the routing number anymore. The IBAN number can direct to a routing server and then to the destination.

It worked for the mobile industry and can work for the banking industry.

dotsman

dublin daz wrote: »

Of course Banks don't want this. One or two might have lost all their fee-paying customers overnight had the switching process been so simple.

It's strange that you say this. Surely, your argument is that, because people may be more enticed to switch banks, every bank that believes that they are the cheapest would be pushing for this. After all, it would mean that these banks would see a huge increase in market share?

So why aren't there any banks pushing for this? Because they see it as a massive, unnecessary cost that would only result in them having to charge customer higher fees and they honestly don't believe that there would be a huge movement of customers. So it is a lose-lose situation for both banks and customers.

Random

i dont get how you can use a landline telephone number as an example against bank account number portability. you can port landline numbers between different irish networks, it opens up the market.

banks will benefit from this as much as they will lose, once they get over the intial phase. if the bank is good they will gain as many customers (or more) than they will lose, and if the bank is bad they will rightly lose customers.

this will benefit customers because it will save the hassle of having to update friends, revenue, bills, loans, landlords, betting slips, etc etc with new bank account details when they switch. they will just be able to have the same bank account all the time.

i dont subscribe to the whole "it makes no sense" suggestion.

Shyboy

I wouldn't have thought that people would switch bank accounts as frequently as they do mobile phone providers but maybe I'm wrong...

Random

i would think the reason more people dont switch bank accounts is because you need a new bank account number etc etc and have the associated hassle that goes with it. the same argument would have been used before mobile phone numbers could be changed back and forth too id image.

mickoneill30

A mobile number might be given to 10s or 100s of people.

A personal bank account might be given to 4 or 5. It's hardly worth all the effort of changing the system for that is it?

I've changed bank accounts in the last year. It's not that hard now. Being able to bring my number with me would have meant little to me. I contacted the guys who had direct debits and gave them my new number. It wasn't hard.
I found out after I did that, that the bank I was moving to had a switching process where they could have done that for me so it could have been even easier for me.

Kennie1

dotsman wrote: »

If you want to switch from bank A to bank B it is very easy.

I beg to differ, I changed bank a few years ago and swore that I would never do it again. I ended up missing mortgage payments, DD's and payroll going to wrong bank. It was a pure mess. One bank blaming the other for each mistake...never again!