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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

#411

Post by joshuaissac »

Reason077 wrote: post #52
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 EU, interchange fees are capped at 0.2% of transaction value for debit cards, and 0.3% for credit cards. This has indeed meant that rewards and cashback credit cards have largely disappeared (with the exception of Amex, which operates outside the interchange system?). Rewards/cashback cards that do still exist are typically tied to specific retailers, with whom the issuing bank has cut their own deals.

There are still a few non-Amex cards that offer cashback with any retailer, although the amounts are small; e.g. Capital One (0.5%), Barclaycard (0.25%).

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

#412

Post by zmk_ »

kzrdude wrote: post #338
lillecarl wrote: post #131

Earlier quoted context omitted.

As a Swede, I thought the CC number would be lower. Most people my age never had a credit card. I do have a Visa DC and a MC CC for redundancy if my bank is down, most people I know doesn't even get why.

I have a DC and cc from the same bank.. not sure if it gives much of any redundancy, but it was the best deal on a cc I could find.

In Sweden, the best CC deals are the petrol station branded CCs (Shell/Circle K) as they both give you cash backs, have some insurance, have the standard grace period, and are "free".

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

#413

Post by sub7 »

India figured this out years ago. Launched a domestic government Visa alternative called RuPay and also launched BHIM - an interface where everyone gets an email address like payment address and can send/receive directly. Both have traction.

Sidenote: A bunch of the payment gateways began integrating BHIM and charging merchants a cut of the sale for what they pay 0 for. Can't see that lasting if people move off V/M completely.

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

#414

Post by hocuspocus »

imtringued wrote: post #374
Polylactic_acid wrote: post #358

Earlier quoted context omitted.

The whole system seems to be designed in such a bad way and relies on a bunch of heuristics and insurance to make up for easy fraud. Why is it that to pay for something you give the seller the keys to your account and they go in and withdraw the money they want instead of the seller sending you a request and you accepting to send the requested money.. Another plus side of your suggestion is it now becomes trivial to…

I'm still wondering why there is no electronic SEPA mandate. When you want to authorize e.g. for your landlord to be allowed to withdraw rent payments from your account the landlord has to physically mail you a SEPA mandate which you have to sign and mail to your bank. This may sound like a slightly obsolete but otherwise well thought out system until you notice that revoking the SEPA mandate requires you to contact…

> I'm still wondering why there is no electronic SEPA mandate.

There is! Nothing forces vendors to collect a paper form and signature. I know some countries still love paper trails (hello Germany) but even there, you'll find some businesses that don't do it. When I lived in Berlin and signed up for my broadband with 1&1, I just had to copy/paste my IBAN into their online form.

> physically mail you a SEPA mandate which you have to sign and mail to your bank.

Nope. The bank is not involved at this stage. Banks authorize direct debits by default, they don't need to know about the mandate beforehand.

> revoking the SEPA mandate requires you to contact the vendor first which is kind of silly.

It's not. It leaves the responsibility with the contracting parties, and keep banks as a neutral medium. That said, as a customer, you can revert a direct debit with a single click, and permanently reject further direct debits. It doesn't have any effect on your contract (and the vendor will send it to debt collection if it believes you're in the wrong), but you keep full control.

By the way, you can build a fully digitized billing system on top of that (there's SEPAmail in France for instance), and more and more banks support instant payments, which I assume can be used to improve the scheme.

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

#415

Post by krzyk »

reaperducer wrote: post #195
paranoidrobot wrote: post #165

Earlier quoted context omitted.

> with the exception of Amex, which operates outside the interchange system? Right, but try using Amex in Europe. Outside of major international hotel chains, or where you can do your purchase online through Paypal, you may as well not bother asking if they accept it.

Outside of major international hotel chains, or where you can do your purchase online through Paypal, you may as well not bother asking if they accept it. It's very interesting to hear that. When I first started traveling to Europe, having an American Express card (or even better, AmEx travelers checks) was the best way for an American to pay for things. It's even written into some classic books and movies. My how th…

In Poland AFAIK when you sign up for a card terminal the company that lends it to you usually gets a cut from the transactions (besides the bank and card companies).

And there is a lower % for normal/popular cards (Visa/Mastercard) and higher (even 4%) for Amex, so most stores just ignore it and remove the Amex symbol from their terminal.

And yet, my company provides Amex corporate card for bussiness travel, but we usually go to US, so Amex is more accepted there.

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

#416

Post by NicoJuicy »

ivan_gammel wrote: post #327
ballenf wrote: post #287

Earlier quoted context omitted.

Germany is still way more cash-based and you see less consolidation of businesses into large chains than in the US. I'm not sure I buy "drowning in the same costs". I think there's something more akin to a prisoner's dilemma here.

Germany is cash-based because of consumer behavior, not because costs are somehow lower. With corona, e-Commerce and services like SumUp more widespread Germany will inevitably catch up with other countries.

Well, I thought so too in the start.

But I asked someone in a popular local store ( Belgium) and consumer behaviour hasn't changed.

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

#418

Post by apexalpha »

Ratiofarmings wrote: post #417

So instead of sometimes one of the two not being accepted, you want me to carry 50 different ones and have 2/3 rejected? No, thank you.

The only reason some cards are not accepted somewhere is because Visa-Mastercard are so powerful they force 3%-5% margins on transactions for merchants.

In the EU the just use bank cards. And since there's regulations the fees are lows and everyone can use it everywhere.

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

#419

Post by rbrtl »

Ratiofarmings wrote: post #417

So instead of sometimes one of the two not being accepted, you want me to carry 50 different ones and have 2/3 rejected? No, thank you.

No... You have the option of any of 50, and they can all be accepted everywhere; rather than the option of only two if you want a chance of being accepted. I believe this is already law in the EU anyway, but there are few competitors to the big two.

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

#420

Post by GordonS »

jb775 wrote: post #298

Could Stripe swoop in and make a play to become a third major CC option? I feel like they have the core infrastructure in place and are still nimble enough to make it happen if they wanted.

Visa own a stake in Stripe, and are unlikely to be supportive of such a play.
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