Credit cards have a privacy problem • Hacker News Board

Re: Credit cards have a privacy problem

#51

Post by ilikehurdles » Tue, Aug 27, 2019, 2:07 AM UTC

nemothekid wrote: post #48

mehrdadn wrote: post #31

Earlier quoted context omitted.

Nobody said unconditional. You just rotate the cards in your wallet and use whatever 5% category fits your purchase. You might not do this, but there are people who do, and never pay interest. They clearly operate at a loss for the company year after year. I'm asking why their accounts aren't closed.

>* I'm asking why their accounts aren't closed.* Because, churners, are a very small portion of the 20B in revenue Visa generated last year, of which it generated a ~50% profit margin. The system works so well already, why rock the boat by closing the accounts of a few thousand individuals? It would probably cost more to enforce any such rule than they lose in revenue.

And by keeping the churners happy, they might recruit some real losers to the platform by word of mouth!

Re: Credit cards have a privacy problem

#52

Post by mehrdadn » Tue, Aug 27, 2019, 2:10 AM UTC

kube-system wrote: post #49

mehrdadn wrote: post #45

Earlier quoted context omitted.

> Because for every person who signs up and causes them a loss, there’s dozens of others enticed by the same rewards programs who make them a profit. That's the answer to the question "why are these cards offered at all", which was not my question. My question was, "why are even the accounts of people who consistently cause them a loss still kept open?", which this doesn't answer.

1. Because those people who were enticed by that program might no be enticed to sign up in the first place if it says “5% cash back (unless you take advantage of this in which case we cancel your account)” 2. I bet government regulators might be a bit peeved by a company that systematically cancels customer accounts for behavior which is within the advertised terms of the agreement. Usually regulators frown upon luri…

1. Possible, but seems unlikely as the explanation? How many people would read that fine print and care? So many other contracts already have provisions like this and nobody blinks an eye.

2. It need not be against their terms though? They could easily specify hyper-optimized usage in their agreements as something that might result in account closure. This is already done in a lot of other cases; they could do the same here.

3. I don't know about that. Just look at the sheer number of sites that explain how to maximize your credit card rewards/cash back/bonuses. They wouldn't seem to be there if the audience for them was so vanishingly small?

Re: Credit cards have a privacy problem

#53

Post by Etheryte » Tue, Aug 27, 2019, 2:13 AM UTC

krick wrote: post #21

arfrank wrote: post #3

Will leave these here, just one small step to help you regain your privacy: * https://marketingreportoptout.visa.com/OPTOUT/request.do * https://www.mastercard.us/en-us/about-mastercard/what-we-do/...

(On Mastercard site) > To opt-out from our anonymization of your personal information... Uh, I'm no lawyer, but the wording really gets my attention here.

That caught my eye as well, it's odd that they chose such a wording and they use it consistently on their notice page [1]:

> Depending on your country, you may have the right or choice to: Opt out of some collection or uses of your Personal Information, including the use of cookies and similar technologies, the use of your Personal Information for marketing purposes, and the anonymization of your Personal Information for data analyses.

[1] https://www.mastercard.us/en-us/about-mastercard/what-we-do/...

Re: Credit cards have a privacy problem

#54

Post by ceejayoz » Tue, Aug 27, 2019, 2:13 AM UTC

mehrdadn wrote: post #50

ceejayoz wrote: post #46

Earlier quoted context omitted.

I suspect you're overestimating how many of those there are.

I suspect you're underestimating? A lot of people (around half of Americans if not more) don't carry a balance. I don't know what fraction of them try to extract the most from their cards, but judging from the sheer number of websites that explain what card you should get to maximize which reward and bonus, I'm skeptical that the number of people who pay attention to this is negligible enough that it'd cost companies…

My explanation seems more likely than the credit card companies acting as a money-losing charity towards rewards maximizers, doesn't it?

Re: Credit cards have a privacy problem

#55

Post by mehrdadn » Tue, Aug 27, 2019, 2:22 AM UTC

ceejayoz wrote: post #54

mehrdadn wrote: post #50

Earlier quoted context omitted.

I suspect you're underestimating? A lot of people (around half of Americans if not more) don't carry a balance. I don't know what fraction of them try to extract the most from their cards, but judging from the sheer number of websites that explain what card you should get to maximize which reward and bonus, I'm skeptical that the number of people who pay attention to this is negligible enough that it'd cost companies…

My explanation seems more likely than the credit card companies acting as a money-losing charity towards rewards maximizers, doesn't it?

Yes, but my original explanation seems far more likely than both? https://news.ycombinator.com/item?id=20805156

Re: Credit cards have a privacy problem

#56

Post by kube-system » Tue, Aug 27, 2019, 2:27 AM UTC

mehrdadn wrote: post #52

kube-system wrote: post #49

Earlier quoted context omitted.

1. Because those people who were enticed by that program might no be enticed to sign up in the first place if it says “5% cash back (unless you take advantage of this in which case we cancel your account)” 2. I bet government regulators might be a bit peeved by a company that systematically cancels customer accounts for behavior which is within the advertised terms of the agreement. Usually regulators frown upon luri…

1. Possible, but seems unlikely as the explanation? How many people would read that fine print and care? So many other contracts already have provisions like this and nobody blinks an eye. 2. It need not be against their terms though? They could easily specify hyper-optimized usage in their agreements as something that might result in account closure. This is already done in a lot of other cases; they could do the sa…

I’m fairly certain that it is not worth their efforts to cancel those accounts, evidenced by the fact that they either don’t do it, or the number of customers it affects is so vanishingly small that neither of us are aware of the practice.

If you believe so strongly that it is worthwhile for them to do this, then perhaps you have an idea for a lucrative career.

But as long as credit card fraud in the US is measured in billions, I’m going to guess that any manpower which can be assigned there is way more lucrative than any manpower assigned to demonizing their honest customers.

Re: Credit cards have a privacy problem

#57

Post by ceejayoz » Tue, Aug 27, 2019, 2:36 AM UTC

mehrdadn wrote: post #55

ceejayoz wrote: post #54

Earlier quoted context omitted.

My explanation seems more likely than the credit card companies acting as a money-losing charity towards rewards maximizers, doesn't it?

Yes, but my original explanation seems far more likely than both? https://news.ycombinator.com/item?id=20805156

If an individual's data was worth $500+ annually like that, Intuit would be realizing substantially more revenue from Mint.com.

Re: Credit cards have a privacy problem

#58

Post by mehrdadn » Tue, Aug 27, 2019, 2:41 AM UTC

ceejayoz wrote: post #57

mehrdadn wrote: post #55

Earlier quoted context omitted.

Yes, but my original explanation seems far more likely than both? https://news.ycombinator.com/item?id=20805156

If an individual's data was worth $500+ annually like that, Intuit would be realizing substantially more revenue from Mint.com.

It's not the same data? Mint doesn't know where you made each purchase and for how much.

Re: Credit cards have a privacy problem

#59

Post by ceejayoz » Tue, Aug 27, 2019, 2:47 AM UTC

mehrdadn wrote: post #58

ceejayoz wrote: post #57

Earlier quoted context omitted.

If an individual's data was worth $500+ annually like that, Intuit would be realizing substantially more revenue from Mint.com.

It's not the same data? Mint doesn't know where you made each purchase and for how much.

The only thing Mint's lacking is the geolocation of the individual merchants - something they can garner in a lot of cases from the merchant name. The grocery store I frequent includes a store number in the transaction name, for example. (Mint definitely has the "how much" bit - they've got each transaction individually, including the amount.)

On the flip side, Mint has all the rest of the credit card data for the person (across potentially many different cards and card networks), savings and checking accounts, brokerage accounts, mortgages, car loans, student loans, and tax returns if you use TurboTax.

I think that balances out the equation pretty handily - that amount of linked, collated data should easily be worth more than a single CC can garner.

Re: Credit cards have a privacy problem

#60

Post by tzs » Tue, Aug 27, 2019, 2:49 AM UTC

ceejayoz wrote: post #30

mehrdadn wrote: post #25

Earlier quoted context omitted.

Right, these are just Visa/MC/etc. card classes, which don't determine the cash back on them. And so if that doesn't make up the difference, then the card companies paying the rest, right? My point is that for high-cash-back cards there are easily customers who consistently make more in cash back than whatever fees these folks get and who don't rack up interest, meaning they're costing money, so why should they still…

Enough of them wind up over-extending and paying interest to make it lucrative. I'm also not aware of any across-the-board 5% rewards cards, and most have an "up to $x,000 annual spend" on the categories that are that high.

A neat little hack with some cards can make it effectively almost across-the-board.

Some rewards cards let you select "online shopping" as your high rewards category. You can extend that to in-store shopping at Walmart by enrolling that card in Walmart Pay and then paying in-store via that.

For a lot of people, "online shopping" and Walmart together will cover 95+% of their credit card use.