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Forget Google, time to end the Visa-MasterCard duopoly

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Re: Forget Google, time to end the Visa-MasterCard duopoly

#271

Post by jedmeyers »

majormajor wrote: post #256
esyir wrote: post #241

Earlier quoted context omitted.

I'll go one step further. This inequality is built into how humans work. Most of us would not extend credit to somebody with low odds of returning it, so why do should we expect companies and organizations to behave differently? I feel like wrapping this up as in the pretty words "systemic inequality" is framing it as some constructed oppressive structure, which I'm loathe to do.

Sometimes humans are selfish, sometimes they are generous. You don't like the term "systemic inequality" yet you're framing the problem in terms of our current system: very impersonal, only-the-numbers-and-ROI matters. If you phrased it as "most of us would choose to exploit the more desperate because they have very little alternatives instead of willingly helping out" you might trigger different instincts. Instincts…

> very impersonal, only-the-numbers-and-ROI matters.

What would be a more personal approach when figuring out whether or not to loan the money to someone?

Re: Forget Google, time to end the Visa-MasterCard duopoly

#272

Post by [deleted] »

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.

[deleted]

Re: Forget Google, time to end the Visa-MasterCard duopoly

#273

Post by kevin_thibedeau »

adrr wrote: post #182
fragmede wrote: post #156

Earlier quoted context omitted.

The outside disrupter was supposed to be Apple Pay, but that didn't work and now Apple just issues credit cards (through Goldman Sachs). Visa/MC has such a monopoly stranglehold that getting kicked off their Network is tantamount to going broke. There are esoteric options aka Bitcoin, money order, check, but if being able to accept credit cards makes this drastically more difficult. (Ask the legal cannabis industry h…

Apple Pay charges a fee as well. It also isn’t a payment system but a tokenization system similar to the chip on credit cards. Zelle was created by the big bank which is why you don’t see it at the small local banks. None of the competitor banks(fintech) have zelle support and I guess this isn’t their choice. They have to move money by ach with is much slower. Any payment/money movement system needs a license and you…

Zelle is just a facade on top of ACH.

Re: Forget Google, time to end the Visa-MasterCard duopoly

#274

Post by harry8 »

Animats wrote: post #261

Visa is now a publicly traded company, but it used to be a chaord, owned by the banks that used it. It's a data network and a standards organization. It doesn't issue cards or handle the money, it just passes transactions from one bank to another. The banks settle up separately.

https://www.forbes.com/sites/andygreenberg/2010/12/07/visa-m...

Note that this was a policy decision based on whim and a politician lobbying. No hearing, no evidence, no recourse, no rights and no meaningful alternative. Also a decision not taken by the banks nor, I believe, were they consulted.

The upopular person's (Wikileaks here) rights are your rights and my rights. If you think the've done the wrong thing, you're entitled to that opion and establishing that is literally what courts are for. Much the same way we might want law and courts involved for suspension of a driving license and not simply because a politician doesn't like you and lobbies a bit. "Nobody who drives for UPS can drive on the roads because they love Putin" --not as ridiculous a fabricated politician's quote as it should be.

But going back to it being a data network and standards organisation that describes the classic long-run decreasing average total cost curve of the natural monopoly which makes privatising it for profit a pure "rent-seeking" play.

So we can see how egregious the monopoly is two ways there. Practically with an example and according to classic and relatively uncontroversial micoreconomic theory.

So what about the classic monopolists' defence, which will come up again here. Define the market to be bigger and claim it's a small fraction of that bigger market. Can we just dismiss that as total B.S.? ie "You can also use cash to buy things." Try running a business or calculate the additional cost of buying the things you need without using the visa/mastercard network.

Unless you have multiple networks with very low switching costs it's a disaster. Disclosure: Ajit Pai disagrees with all that totally.

Re: Forget Google, time to end the Visa-MasterCard duopoly

#275

Post by numpad0 »

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.

Also it’s like bringing up search alone when talking about web.

In reality an intermediary called “payment processor” handle all CC brands in single system and they are the ones enforcing ideological punishments to merchants.

Like there’s web search and web browser, card networks and payment processors both should be brought up.

Re: Forget Google, time to end the Visa-MasterCard duopoly

#276

Post by [deleted] »

reaperducer wrote: post #201
jariel wrote: post #44

Earlier quoted context omitted.

"The 2% cashback has to come from somewhere." Yes, but in reality, the program comes from an upside down approach to overcoming the obviously anti-competitive practices that VISA/MC use to forbid retailers from offering discounts for not using VISA etc.. You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. You also can't say "$1.99 + 20 cent…

You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. I see this all the time. * At more than one bookstore, the dry cleaner, markets, my current and previous landlord, my accountant, and pretty much every gas station since the 1990's. * Pre-quarantine. Now I don't see anything.

[deleted]

Re: Forget Google, time to end the Visa-MasterCard duopoly

#277

Post by petre »

Thorrez wrote: post #225
jariel wrote: post #44

Earlier quoted context omitted.

"The 2% cashback has to come from somewhere." Yes, but in reality, the program comes from an upside down approach to overcoming the obviously anti-competitive practices that VISA/MC use to forbid retailers from offering discounts for not using VISA etc.. You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. You also can't say "$1.99 + 20 cent…

> You also can't say "$1.99 + 20 cents processing charge" - no, the price must be listed including charges. (Notice that nobody every does this?) The place I went to yesterday for lunch did this. This is in Silicon Valley. I believe it was a 3.9% credit card fee.

You never see that in Europe. What you see is shop owners claiming their POS is broken.

Re: Forget Google, time to end the Visa-MasterCard duopoly

#278

Post by JAlexoid »

reaperducer wrote: post #201
jariel wrote: post #44

Earlier quoted context omitted.

"The 2% cashback has to come from somewhere." Yes, but in reality, the program comes from an upside down approach to overcoming the obviously anti-competitive practices that VISA/MC use to forbid retailers from offering discounts for not using VISA etc.. You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. You also can't say "$1.99 + 20 cent…

You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. I see this all the time. * At more than one bookstore, the dry cleaner, markets, my current and previous landlord, my accountant, and pretty much every gas station since the 1990's. * Pre-quarantine. Now I don't see anything.

There are cases, where the person you're interacting with isn't likely to be audited or doesn't have a direct contract with the payment processor.

Gas stations I find weird, in general. How did they get that exception?

Re: Forget Google, time to end the Visa-MasterCard duopoly

#279

Post by JAlexoid »

disillusioned wrote: post #230
jariel wrote: post #44

Earlier quoted context omitted.

"The 2% cashback has to come from somewhere." Yes, but in reality, the program comes from an upside down approach to overcoming the obviously anti-competitive practices that VISA/MC use to forbid retailers from offering discounts for not using VISA etc.. You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it. You also can't say "$1.99 + 20 cent…

This used to be the case, but it isn't anymore. https://en.wikipedia.org/wiki/Expressions_Hair_Design_v._Sch... Plus, plenty of gas stations show a cash/credit price on their signs. The merchants are no longer allowed to block this behavior.

That's applicable to legislation, private contracts can still require no surcharge.

Re: Forget Google, time to end the Visa-MasterCard duopoly

#280

Post by JAlexoid »

eru wrote: post #204
tomklein wrote: post #166

Earlier quoted context omitted.

In Germany lots of places just don’t accept any cards besides Visa and MasterCard just because of the seller fees.

And even Visa and MasterCard took a while to get hold. I remember Aldi holding out for ages.

There are many places in Europe that have weird rules... Like some dutch places not accepting EU debit cards. Aldi in Ireland doesn't accept out of country debit cards.
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