Thursday, November 12, 2009

Will that be cash or...cash?

The other day in Kyiv a couple were robbed at gunpoint of $350,000 USD which they were carrying in a briefcase, just like in the movies. The gunmen knew they had just sold their house and would be leaving the real estate office, or more likely a lawyer's office, with cash. The police caught the men and retrieved the cash. That fact is more astounding than that the couple were carrying cash after selling their home but it is not the point of my story.

For purchases except at retail where they take credit cards, either money is deposited directly into a person's or firm's bank account or cash changes hands. Or both. That is how we bought our car, for example. Kia Motors gave us an account number good for two days into which we were to deposit the purchase price of the car. We took the receipt from the bank to the dealership and proceeded from there.

When Tanya and I bought her Ex's share of the house we were directed to deposit half the money into his bank and bring the other half in cash. We had a wad of $100's that would choke a horse and made me very nervous.

While mortgages are available I have no idea how one would get them following these business practices. To me it made sense to borrow the money to buy out Tanya's Ex by taking out a mortgage for his share, using her share as security. Wouldn't happen, Tanya said. No money no signee.

I tried to buy Lingvo dictionary on line to down load. I wanted to buy it as of Ukraine, not Canada as the cost was half and it came with Ukrainian in the bundle, not just Russian English. I wanted to pay for it with my Canadian credit card on line. That too was a non starter. Only credit cards from Ukrainian banks were accepted. We found a shop that carries ABBYY products in Dnipropetrovsk and we'll buy it there. For cash.

We live in a country where fraud could be an everyday occurance and property rights and contract law are pretty hazy concepts; with outcomes by no means predictable. Cash is safe.

8 comments:

  1. I wonder where the couple was going with the money. Are cashier's checks unknown in the Ukraine?

    Here in the U.S., I only use cash for very small purchases--under $7 or so. Anything more than that, I use a credit card, not because I can't afford to pay cash, but rather for the airline mileage, and so I'll have a record of the purchase, and so I have an extra avenue of complaint if the merchandise is inferior. Are credit cards not commonly issued by Ukrainian banks?

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  2. The couple was likely going to buy another house.
    Banks do issue credit cards but few places accept them. Just the big retailers.

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  3. Here, the couple would have gotten a check and used it to buy the new house. I don't understand the enthusiasm for cash in the Ukraine when its use guarantees situations such as you described.

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  4. Checks? There wouldn't be one written that was any good. You do not understand the dishonesty and distrust in this country. One hopes things will change with time but corruption as a way of life seems to stick in a culture forever.
    The reluctance of merchants to use credit cards has as much to do with the impossibility of getting land lines as anything, I think.

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  5. All this is extremely interesting to me. Do people trust banks? I mean, might the couple have been planning simply to hide their money under their mattress?

    Here, if a person didn't feel sure that a check was good, he would not release the merchandise until it had cleared, or else he would go to the bank with the buyer and get a check written by the buyer's bank, and then deposit that check into his account at his own bank. Unless banks are not trusted, these would seem like obvious solutions.

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  6. or else he would go to the bank with the buyer and get a check written by the buyer's bank, and then deposit that check into his account at his own bank

    Essentially that is what they do but without the check. If I want to buy a big ticket item, i deposit teh money from my account into your account and take the slip back to the store.

    Banks are trusted more than they ought. we have dozens of small banks, much like USA, some of which are less solvent than one would like.

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  7. Here, an alternative to banks are the credit unions. They are smaller, locally owned, and customer friendly. It was the big banks (Wells Fargo, J. P. Morgan Chase, and Bank of America) that caused much of our recent financial problems, so I stopped banking with them for that reason along with their unscrupulousness and lousy service.

    Under your payment system, I would be worried that I would deposit my money, and then the seller would disappear with it without giving me my purchase.

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  8. For a long time, the country music quartet "The Statler Brothers" was the "warm-up act" for Johnny Cash. When the Statlers left "The Man in Black" to advance their own career (happy end to relationship), they wrote a song about their work together. It was called "We Got Paid by Cash."

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