Ever made a payment online?  Of course you have.

I now pay my credit card bill online.  I don’t do an automatic payment – I like some measure of “hands on” control.  But I know this:  Once I execute a payment to my card company, by clicking ‘Submit,’ I receive a confirming text message to my phone nearly instantaneously.  I’m talking about a couple seconds.

I pay my car insurance online.  When I execute payment, I get an e-mail confirmation almost immediately.  Within a minute, easily.

Same for cable.  Same for power.  These transfers (both in terms of money, and communications) happen with a speed of execution that is extremely efficient.

Not so for certain other transactions.  When I initiate a transfer to my bank from PayPal, I’m advised that the funds will be in my bank account between 3 and 5 days’ time.  Meantime, my PayPal balance is 0 (or down by whatever amount I’m transferring).  So, where’s the money in the meantime?  And why can the transfer not be immediate, as in the former cases above?

When I do a bank-to-bank transfer, I receive a similar counsel:  The money will be in my other account in approximately 3 days.  Meanwhile, the originating account is debited – but there is no credit (yet) on the other end of the pipe.  Where’s the money?

Well… it’s obviously in some kind of limbo.  That money does exist:  It’s not vaporized while “in transit.”  However, wherever it resides, you can bet it is making money in the form of interest, or lending itself to investment.  How?

Just consider the one case – that of PayPal:  They are transacting money all over the world.  PayPal is handling money in the millions, likely billions, of dollars.  At any given moment in time, PayPal has a tremendous amount of money in limbo, suspended between various accounts during those 3-to-5 day delays.  This represents an ‘asset bubble’ and that pool of money on a balance sheet is a resource:  That resource of money is earning interest, or funding investments – at least, it seems to me.  Meantime, you wait for your money to transfer at the speed of… well, something other than electrons.

This would seem to be a newsworthy story, and a ripe area for a little legislation.  A 3-to-5 day delay is not necessary in vetting the transfer of money.

What do you think?

 

Should we migrate to the Cloud?  I hear this question frequently, particularly from small and mid-sized business.

Cloud solutions can provide robust, internet-based, IT solutions absent the need for heavy capital investments in infrastructure.  Too, there is the ability to scale according to business growth and change:  necessity for new storage capacities and scales of processing; perhaps demands from personnel for sophistication in the handling of systems’ related process – things the organization may lack, and which the Cloud provider can offer.

Of course, the question must be asked:  What of security?  Anything in the Cloud is not within the “four walls” of the organization.  (An org may, of course, have multiple locations – but here the “four walls” concept is a metaphor, vis-à-vis the fact that data and process are now harbored outside any direct physical location of the organization).

One bellwether worth watching is the banking industry.  Banks, like any responsible organization, are constantly on the watch for means of enhanced productivity – and here the Cloud has ready offerings.  Whether it’s infrastructure savings, operating expenditures savings, or new cloud-based business models, the goal is to best leverage the mix of private, public, and community-based resources that are in the Cloud.

Of course, banking is wary, because of data’s location, and the potential influence on steady availability, and the necessity for rapid recoveries in case of loss or corruption.  Data’s integrity, related issues of confidentiality, and means of authentication are also concerns.  Banks, and perhaps you too, are leery of outsourcing customer data to third-party Cloud providers and operators.

If you’re considering any measure of move to the Cloud, take a hard look at various providers.  Assess their history, client base, and financial stability.  Also examine their functionalities and services levels:  Look into their ability to integrate data and process across various platforms and through a variety of cloud services.

On this day:  Sep. 27, 1905, the first published blues composition goes on sale – W.C. Handy’s “Memphis Blues”