One problem, you're going from one woman's top-down control to another.
Jane Larimer, President and CEO
Jane Larimer is President and CEO of Nacha, which governs the modern ACH Network, the payment system that quickly and safely moved more than 29 billion payments in 2021. Nacha also develops rules and standards, provides industry solutions, and delivers education, accreditation, and advisory services.
Jane has led Nacha since July 2019, guiding the association as it builds consensus to further innovation in the payments industry. Jane has been recognized for her work in advancing the ACH Network and for Nacha as a leader in payments education. In 2022, Jane was named one of Washington DC’s Most Influential People by Washingtonian Magazine, and in 2021, she was named one of the Most Influential Women in Payments by PaymentsSource.
During the era of checks, every federal reserve bank hosted a "clearinghouse".
This was a location where all the banks under that Reserve Bank would meet and swap checks that had been given to them. Balances would be paid out.
ACH replaced that system electronically. Instead of a paper check, an ETF record is handed around and then money changes hands.
The system is still fundamentally controlled by the government. The only ways a transaction can be refused is either because it was unauthorized/fraudulent, or because the account doesn't have the funds.
To actually kick a participant out of the ACH system would require the participating entity to be recognized as a habitual source of fraudulent or overdrafting transactions, and that determination is made by the government, and can be fought in federal court.
You set up a bank, a proper bank, FDIC insured, everything, and then you direct market it as a free speech harbor.
At that point it's MUCH harder for other companies to say they won't work with you. If the customer with the money says to transfer the money, they have to transfer it as a legitimate, authorized transaction.
Refusing at that point means going to federal court and convicting the BFS to say you're not a legitimate bank. That's a much, MUCH higher hurdle, one these leftists won't be able to clear.
It's a non-starter. Banks have capital requirements that none of us could meet. If you go under them for a second, you'll be shut down. You also need to do a lot of paperwork to operate internationally.
Also, as I edited in, ACH suffers from the same problem as MasterCard. A feminist woman pulling the strings. You're just relying on her being constrained by red tape from using the power available to her.
What you're suggesting is far larger than a credit union. You're suggesting the banking equivalent of what Elon says Twitter will be. You're going to need to operate in more than just the US if you want that, and European rules on banking are very strict. To create an international bank is a huge endeavor. It's why you don't see new banks pop up that often.
If you limit yourself to just operating in the US, you might be able to start with a far lower amount, but there's still pitfalls
If you don't have branches, your weak point is your website/app being blocked in some way, if you do, that's a cost you have to bear.
If we had someone serious about it looking into it, it might be possible. You'd also have to have a buffer to prevent bad actors creating a bank run.
https://www.investopedia.com/terms/a/ach.asp
This?
One problem, you're going from one woman's top-down control to another.
Jane Larimer, President and CEO
NACHA is an industry group, they don't make the rules.
The Bureau of Fiscal Service makes the rules. That's the Treasury Department.
Means that to shut you down, they have to get the FEDS to shut you down, they can't just blacklist you out of spite.
It says they govern it, doesn't that mean they make the rules?
ACH is honestly something I don't hear about much, so I don't understand too well how it works.
During the era of checks, every federal reserve bank hosted a "clearinghouse".
This was a location where all the banks under that Reserve Bank would meet and swap checks that had been given to them. Balances would be paid out.
ACH replaced that system electronically. Instead of a paper check, an ETF record is handed around and then money changes hands.
The system is still fundamentally controlled by the government. The only ways a transaction can be refused is either because it was unauthorized/fraudulent, or because the account doesn't have the funds.
To actually kick a participant out of the ACH system would require the participating entity to be recognized as a habitual source of fraudulent or overdrafting transactions, and that determination is made by the government, and can be fought in federal court.
Yes, that.
You set up a bank, a proper bank, FDIC insured, everything, and then you direct market it as a free speech harbor.
At that point it's MUCH harder for other companies to say they won't work with you. If the customer with the money says to transfer the money, they have to transfer it as a legitimate, authorized transaction.
Refusing at that point means going to federal court and convicting the BFS to say you're not a legitimate bank. That's a much, MUCH higher hurdle, one these leftists won't be able to clear.
It's a non-starter. Banks have capital requirements that none of us could meet. If you go under them for a second, you'll be shut down. You also need to do a lot of paperwork to operate internationally.
Also, as I edited in, ACH suffers from the same problem as MasterCard. A feminist woman pulling the strings. You're just relying on her being constrained by red tape from using the power available to her.
You are thinking the numbers are a couple orders of magnitude larger than the numbers really are.
How do you think local credit unions keep poping up and then going under?
Yes, and?
NACHA IS ONLY AN INDUSTRY GROUP, THE RULE MAKING BODY IS THE DEPARTMENT OF THE TREASURY.
What you're suggesting is far larger than a credit union. You're suggesting the banking equivalent of what Elon says Twitter will be. You're going to need to operate in more than just the US if you want that, and European rules on banking are very strict. To create an international bank is a huge endeavor. It's why you don't see new banks pop up that often.
If you limit yourself to just operating in the US, you might be able to start with a far lower amount, but there's still pitfalls
If you don't have branches, your weak point is your website/app being blocked in some way, if you do, that's a cost you have to bear.
If we had someone serious about it looking into it, it might be possible. You'd also have to have a buffer to prevent bad actors creating a bank run.