Debit cards are hidden financial infrastructure

Post by ikr678 » Sun, Nov 14, 2021, 1:02 AM UTC

ryandrake wrote: post #94

rjzzleep wrote: post #81

Earlier quoted context omitted.

What's transaction reordering? 1. have $10 in your checking 2. pay $9 for steak 3. fill account with $500 4. buy sausage for $2 bank reorders it as 1. have $10 in your checking 2. pay $9 for steak 3. buy sausage for $2 4. charge overdraft 5. count $500 deposit Is that what banks would do? I faintly remember that really old accounts I had in Germany had overdraft capability, but for all newer(last decade or so) accoun…

Yes, that's exactly what they would do. Even better (for the bank's profits) is if you had lots of other smaller transactions that day too. They would re-order everything from largest-to-smallest, so it's: 1. have $10 in your checking 2. pay $9 for steak 3. buy sausage for $5 4. charge overdraft 5. buy milk for $3 6. charge another overdraft 7. pay $2 for parking 8. charge another overdraft 9. buy a pack of gum for $…

Post by fragmede » Sun, Nov 14, 2021, 2:15 AM UTC

JoBrad wrote: post #295

steveBK123 wrote: post #99

Earlier quoted context omitted.

The transaction re-ordering to maximize the amount of overdraft events should have put execs in prison. Out of all the obviously corrupt, mal-intent, direct consumer harming practices this was quite near the top.

It wasn’t illegal, and maybe isn’t (although I thought it was). I know that I was impacted by this as a college student, and ended up paying hundreds of dollars in fees for a single weekend. I had OD protection fees and “bounce fees” for the “protection fees”. It was insane. However I thought this was at least made unprofitable by capping fees and limiting when they could be applied. All of this insane behavior is a…

Post by watersb » Sun, Nov 14, 2021, 4:00 AM UTC

sueders101 wrote: post #262

devoutsalsa wrote: post #249

Earlier quoted context omitted.

Revolut, Simple, and Chime, the three online only banks I have tried, all do (or did) this. It really helped back when I was living paycheck to paycheck.

For what it's worth; I banked with Simple for the better part of 10 years, but then they acquired by BBVA who was then acquired by PNC. That meant that all Simple customers had to go through account migration twice this year, and in the end now have all the typical fees associated with traditional accounts. Ultimately I decided to move to a local credit union.

Post by mvkel » Sun, Nov 14, 2021, 5:13 AM UTC

mdorazio wrote: post #322

unicornmama wrote: post #256

Earlier quoted context omitted.

I mean it’s a hyper growth startup. Expect to haul ass.

Stripe is 12 years old, has ~4,000 employees, and does several billion in revenue each year. It’s not a startup anymore. Although I do agree with your general sentiment that if you want real work-life balance, an actual startup is probably not for you.

Post by kerneis » Sun, Nov 14, 2021, 6:29 AM UTC

dustintrex wrote: post #64

kccqzy wrote: post #59

> Typically, the apps offer their users a choice: payouts at the speed of banking, for free, or payouts at the speed of the Internet, for a small convenience fee. Cash App charges 1.5% with a minimum of a quarter. This is just another way the financial system (including fintech startups) preys on the poor. If you are well off, you wouldn't want to pay any convenience fee for the privilege of receiving money from a bu…

It's also another illustration of how backwards US payments infra is. In the EU, SEPA instant payments are just that: by law it can take a maximum of 10 seconds for the recipient to get paid, including across countries. And, of course, they're free. https://en.wikipedia.org/wiki/Single_Euro_Payments_Area