Speedier payment systems could curb your costs

Here’s an illustration of the many ways slow payment systems can inconvenience you and cost you money.

Let’s say Homer is two days from payday. The family checking account at First Bank of Springfield is on fumes. There’s just enough in the account, Homer thinks, to gas up his Plymouth sedan and buy Bart a Squishee at the Kwik-E-Mart.

But Marge checked the account balance too, and thought she could safely buy groceries. Because Homer and Marge didn’t realize they were spending the same money, one of the transactions triggers an overdraft fee. Plus, they forgot the power bill is due, and utility owner Mr. Burns charges a wicked late fee.

Homer hits up Lenny and Carl for a loan, but Lenny uses Venmo, Carl uses PayPal and Homer uses only Zelle. Lenny writes Homer a check, but it’s from National Bank of Springfield, so First Bank puts a hold on the deposit. Desperate, Marge breaks into Lisa’s piggy bank for money to pay the power bill, but has to pay a fee to “expedite” a same-day bill payment.

The animated “Simpsons” television show might use this scenario to get laughs, but it’s not funny for Americans who pay billions of dollars in overdraft charges and late fees , thanks in part to antiquated payment systems. The most vulnerable people turn to high-cost payday loans to bridge cash flow gaps, and some leave the banking system altogether because of high, unpredictable fees.

In my latest for the Associated Press, how a change at the Federal Reserve could speed up payments dramatically.

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