Threats hurt bank's payment business

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CheckFree and Quicken

Just a few years ago Quicken combined its single entry accounting system, which was standard on palmtop devices from HP, with a bill payment system called CheckFree. It was a wonderful service and even Microsoft could not duplicate it with Money.

CheckFree would print a check and mail it to banks not doing electronic transfer and a team of legals could be relied on to sort out issues involving bill collection.

When a vendor claimed their payment had not been received, I would just email CheckFree and that was it. No more hassling phone calls and threatening letters and never a finance charge.

There was never a finance charge because I would enter a payment amount when I made a purchase even before a bill was generated. I also enter a payment date in Quicken. The palmtop would transmit that information to Checkfree when I connected the device to a phone. The system really was similar to an ATM withdrawal at a gas station or convenience market in that connectivity was through a modem.

The demise of this mechanism happened after Microsoft failed to purchase Quicken for antitrust reasons.

Eventually Quicken for DOS was dropped and you had to have Windows to make it work. This was acceptable because if you played your bills completely through Quicken you could generate your tax forms through other software which imported the Quicken files. So it continued being used, even though confined to desktop units rather than HP palmtops.

None of the bank provided and vendor provided payment mechanisms will ever be able to match that. It is the fatal flaw in a bank's payment business.

The stated reason that the Quicken to CheckFree mechanism was shut down was that modem service (provided by I suppose a contractor to Quicken) was shut down. So now we do bills the old way where banks make money with late charges.

I recently contacted Bank of America about Visa billing. The BofA does not commit to a set billing period so you can not predict exactly when the bill will be presented to you. If you do your bill paying on the week ends, as many folks do, then you are likely to get a late fee from time to time because Bank of America gives the customer just a week or so grace period.

What they propose as a fair remedy is for customers to move accounts to Bank of America so they can withdraw payments on their time. Or they want to gather information about your banking and arrange to withdraw from the other banks. It is hardly fair, especially given identity theft and privacy issues.

The demise of the CheckFree/Quicken mechanism is something the US government should be looking at. If not that then a two week or more payment grace period should be required by law.

I suspect the devil is not in the details but in a conspiracy. Bill payment issues were solved years ago by innovation. That innovation was denighed US consumers for reasons of greed.

Now lets have the story of Microsoft et als solution to this contrived situation.

Frank L. Mighetto CCP

Posted by: mighetto   Posted on: 05/30/06 You are currently: a Guest | Members login | Terms of Use

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