Forget Google, time to end the Visa-MasterCard duopoly

Post by crazygringo » Tue, Jun 30, 2020, 2:54 AM UTC

koheripbal wrote: post #161

crazygringo wrote: post #73

Earlier quoted context omitted.

That is common. My grocery store, my bodega, my doctor's office, my dentist -- they all offer a 5% discount for paying in cash. Obviously not everyone does it, but it's certainly not uncommon. On the other hand, there are also a lot of costs associated with handling cash. The expense of tracking bills and coins and going to the bank every day is not insignificant. So it's pretty easy to argue that there's no reason f…

That's a little different. They offer discounts of 5% because they then don't report the income and don't pay taxes. The CC companies are only taking 2.5%-3.2%. If they're offering a 5% discount for cash - it's almost certainly tax evasion.

Post by danhak » Tue, Jun 30, 2020, 2:55 AM UTC

argonaut wrote: post #186

crazygringo wrote: post #45

I don't get it -- Amex and Discover are still providing healthy competition, so the "duopoly" the author complains about seems to be largely irrelevant. Competition between cards is thriving and consumers benefit -- witness the miniscule transaction fee the credit card companies keep after paying your rewards back of 2% to 5%, when you pay your bill on time. The article's main point is that such large companies are a…

I don't get it -- bringing up Amex and Discover is like bringing up Bing and DuckDuckGo when people talk about the Google monopoly.

Post by milkytron » Tue, Jun 30, 2020, 2:57 AM UTC

gruez wrote: post #157

ComputerGuru wrote: post #37

Earlier quoted context omitted.

Interchange fee pricing is set based on how much MasterCard charges the bank That’s not true though, or at least is a massive oversimplification. In the US, interchange fees are extremely inflated to allow banks to recuperate the rewards they give out to distinguish their card offerings from one another. The 2% cashback has to come from somewhere.

>In the US, interchange fees are extremely inflated to allow banks to recuperate the rewards they give out to distinguish their card offerings from one another. The 2% cashback has to come from somewhere. And that's a bad thing, because it's essentially the poor subsidizing the rich. People who aren't able to get credit cards (or the "good" cash back credit cards) tend to be worse off financially than people who do.

Post by cheriot » Tue, Jun 30, 2020, 3:00 AM UTC

lucaspm98 wrote: post #205

gruez wrote: post #157

Earlier quoted context omitted.

>In the US, interchange fees are extremely inflated to allow banks to recuperate the rewards they give out to distinguish their card offerings from one another. The 2% cashback has to come from somewhere. And that's a bad thing, because it's essentially the poor subsidizing the rich. People who aren't able to get credit cards (or the "good" cash back credit cards) tend to be worse off financially than people who do.

Do you think it’s not fair for credit card issuers to try to attract customers that have a higher value to them by offering rewards? Regardless, approvals are mostly based on credit history and not wealth. I was a low income earner for years but paid my bills and credit cards on time so I could get any card I wanted.

Post by chii » Tue, Jun 30, 2020, 3:02 AM UTC

milkytron wrote: post #215

gruez wrote: post #157

Earlier quoted context omitted.

>In the US, interchange fees are extremely inflated to allow banks to recuperate the rewards they give out to distinguish their card offerings from one another. The 2% cashback has to come from somewhere. And that's a bad thing, because it's essentially the poor subsidizing the rich. People who aren't able to get credit cards (or the "good" cash back credit cards) tend to be worse off financially than people who do.

Isn't that the fault of the credit system though? Those who have access to more credit (or have better credit) are able to take advantage of these offers.