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Tech companies are clamoring to give you credit cards

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Re: Tech companies are clamoring to give you credit cards

#11

Post by dylan604 »

est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

And here I thought the entire idea behind credit cards was to make up to 22% interest from the user. The 3.5% per transaction from the retailers just seems like bonus. If not even considered a double dipping since most retailers will take the 3.5% into consideration of their pricing.

Re: Tech companies are clamoring to give you credit cards

#12

Post by deegles »

est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

You have to sort cash, count it, deal with counterfeit bills, run it to the bank, etc. There must be a break-even point if a business values its time.

Re: Tech companies are clamoring to give you credit cards

#14

Post by est31 »

dylan604 wrote: post #11
est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

And here I thought the entire idea behind credit cards was to make up to 22% interest from the user. The 3.5% per transaction from the retailers just seems like bonus. If not even considered a double dipping since most retailers will take the 3.5% into consideration of their pricing.

There is a difference between "credit credit cards" and "debit credit cards". Debit credit cards are a bad idea for consumers because of those 22% as well as liabilities when being victim of a crime. But yes, many people treat the limit of those debit credit cards as a way of having money. It isn't though.

Re: Tech companies are clamoring to give you credit cards

#15

Post by NathanielLovin »

Shivetya wrote: post #8

I understand some of the appeal of metal cards and the like but this seem short order as the move to contact less payments increases. To be honest the less someone knows about my purchase which includes the brand on the card the better Now I can see the appeal to some, example the Apple card, where pricey items can be paid for at no interest with the added hope they use your card elsewhere. I haven't look into Apple'…

Apple Card is 1% cash back on all purchases, 2% if you use Apple Pay, 3% if you shop at Apple (and a couple others now). It as Apple Cash so it can be used anyway you use Apple Pay (or just on your statement, I think). It’s not the best card but it’s decent.

Re: Tech companies are clamoring to give you credit cards

#16

Post by milkytron »

908B64B197 wrote: post #3
45756e wrote: post #2

Funny to think that as well as tech companies trying to give out credit cards, a few financial companies (Capital One) are now seeing themselves and identifying as tech companies. Although based on the article, it doesn't seem like the latter is really related to the former.

> a few financial companies (Capital One) are now seeing themselves and identifying as tech companies. Is it branding or an actual shift? I've seen many companies pivot to being "tech companies" but still didn't have incentives in place to attract real talent, and more crucially that still treated software and tech as a cost center. But hey they had bean bags!

Having worked for banks that have said this, I can say it's branding without much substance behind it.

They say this to attract talent. The talent doesn't remain long unless they get into all the politics and butt sniffing that goes on at large established companies. Those that actually produce end up being taken advantage of and credit goes towards the people that manage them.

Re: Tech companies are clamoring to give you credit cards

#17

Post by snarf21 »

est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

Cash businesses are also some of the ones the most prone to employee theft, especially bars. Also, the 3.5% is just passed on to the consumer is happy to pay for the convenience it brings.

Re: Tech companies are clamoring to give you credit cards

#18

Post by conjecTech »

deegles wrote: post #12
est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

You have to sort cash, count it, deal with counterfeit bills, run it to the bank, etc. There must be a break-even point if a business values its time.

It's nowhere near 3.5%. It's probably an order of magnitude less. My mother spent a decade as the controller of a luggage store chain. She told me the amount they spent on credit card fees was at times in excess of their stores' payroll. It is rent seeking at nearly unfathomable levels. Even the shady check cashing operations for the unbanked are able to operate profitably on a 1% cut.

Re: Tech companies are clamoring to give you credit cards

#19

Post by dahfizz »

est31 wrote: post #14
dylan604 wrote: post #11

Earlier quoted context omitted.

And here I thought the entire idea behind credit cards was to make up to 22% interest from the user. The 3.5% per transaction from the retailers just seems like bonus. If not even considered a double dipping since most retailers will take the 3.5% into consideration of their pricing.

There is a difference between "credit credit cards" and "debit credit cards". Debit credit cards are a bad idea for consumers because of those 22% as well as liabilities when being victim of a crime. But yes, many people treat the limit of those debit credit cards as a way of having money. It isn't though.

Can you explain this a bit more? I have no idea what you mean by "credit credit card" vs "debit credit card".

Re: Tech companies are clamoring to give you credit cards

#20

Post by qwerty1234599 »

est31 wrote: post #7

The entire idea behind credit cards is to force processing fees upon store owners. As a store owner you are required to pay up to 3.5% of your revenue to the processing company (the percentage can be even higher than that if you sell stuff for small amounts, like just a dollar). With cash you can choose your bank and there is more of a free market, while with credit cards you can't get around not accepting certain br…

I'd wager the average card purchase is way larger than 3.5% compared to cash, as the money being spent feels less real.
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