Debit cards are hidden financial infrastructure • Hacker News Board

Re: Debit cards are hidden financial infrastructure

#381

Post by kwere » Sun, Nov 14, 2021, 5:06 PM UTC

nodemaker wrote: post #348

chasebank wrote: post #323

Earlier quoted context omitted.

In 2004 I was traveling around Europe as a 20 year old. Spent my debit account down to my last $20. I had a flight from Barcelona back to Boise and the airline had supposedly issued a paper ticket, not an e-ticket. Long story short, if I couldn’t produce the paper ticket, my flight was going to leave without me. I didn’t have a credit card and I knew I was out of money but I said what the hell, try my debit card to p…

Ha I had the exact same experience with Wachovia bank in New York City once and basically their argument was on the lines of “The highest value transaction was probably the most important for you so we ordered it by price so that your most important transactions go through first”. In a way though I feel like the American system is set up to traumatize you for being poor so much that you develop the thirst to become a…

or to keep you vulnerable/exploitable and maybe accomplice higher up in the ladder

Re: Debit cards are hidden financial infrastructure

#382

Post by kwere » Sun, Nov 14, 2021, 5:14 PM UTC

anonymouse008 wrote: post #310

afc wrote: post #263

Earlier quoted context omitted.

> 1.5% in 3 days. That's not even an annualized figure. If annualized it would be 1.5%/3*365=122% Your formula for annualized interest rate is incorrect. Interest compounds. 1.5% in 3 days is 612% annualized, not 122%, a large difference. You can compute this thus: pow(1.015, 365.0 / 3)

Now do payday loans… it’s sickening. When US leadership speaks about systemic racism, and they don’t talk about payday loans and overdraft fees I can’t take them seriously. It’s insulting

maybe because is a political buzzword to weaken the opposition power and nothing more

Re: Debit cards are hidden financial infrastructure

#383

Post by roystonvassey » Sun, Nov 14, 2021, 5:48 PM UTC

dan-robertson wrote: post #377

xook wrote: post #332

Earlier quoted context omitted.

What would classify as a private bank? IME, you're given the option for overdrafts regardless.

I think this is a dialect difference. To me (and presumably the parent?) private bank means a bank that offers private banking services to wealthy clients which generally involves selling certain loans or investment products rather than a current account. Whereas I think the grandparent meant “bank not owned by the state”. But I’m not entirely sure

Yes. I meant private bank as in "not a government owned bank".

Re: Debit cards are hidden financial infrastructure

#384

Post by jedimastert » Sun, Nov 14, 2021, 6:22 PM UTC

samhw wrote: post #376

jedimastert wrote: post #335

Earlier quoted context omitted.

> Maybe the HN crowd has never been in a situation where they were auto-billed into a negative balance I wonder about this some times. It's truly not something I wish upon anyone, but at the same time it's almost a privilege to have live it first hand, as it's an...I was gonna say "unfortunately rare" but I think I'll go with "severely under-represented" point of view in this industry, especially silicone valley. Als…

> Also yes, overdraft fees are truly disgusting. What's worse is that there are transactions that can bypass "overdraft protection". Totally agree. I used to work in the lending team at a UK bank. Someone on my team was on a panel discussion about change in banking, and gave a brilliantly frank answer on that point: https://youtu.be/M3toHjAABvw?t=3511 > it's an...I was gonna say "unfortunately rare" but I think I'll…

> I honestly don't well enough understand the sociology of software engineering to fathom why we're so silent on that particular dimension of privilege.

I suspect that, much like much of STEM, computer science requires education, which poorer folks will simply not have nearly the opportunity to even attempt.

Re: Debit cards are hidden financial infrastructure

#385

Post by smabie » Sun, Nov 14, 2021, 11:20 PM UTC

donarb wrote: post #274

smabie wrote: post #80

Earlier quoted context omitted.

Why would you ever not want to put something on a cc? It's quite literally free money (rewards/points + you can delay payments for a month and pay no interest)

Rewards/points are not free. You're paying more upfront to get something "free" later on.

What do you mean? I'm not paying anything upfront for using a cc afaik. There are cards with yearly payments of course, but they tend to be marginal.

Re: Debit cards are hidden financial infrastructure

#386

Post by dalyons » Sun, Nov 14, 2021, 11:25 PM UTC

numair wrote: post #43

The beginning of this article is a fairy tale that ignores what used to be one of the biggest drivers of revenue for banks: overdraft fees. Maybe the HN crowd has never been in a situation where they were auto-billed into a negative balance, which then caused an overdraft fee that then further drove their balance into negative territory, but this was a weekly/monthly fiasco for millions of Americans. I was once in a…

Not “used to be” unfortunately. American banks took in somewhere between $9-15 billion (depending on source) in overdraft fees in 2020. It’s super gross.

Re: Debit cards are hidden financial infrastructure

#387

Post by smabie » Mon, Nov 15, 2021, 12:12 AM UTC

lottin wrote: post #196

smabie wrote: post #80

Earlier quoted context omitted.

Why would you ever not want to put something on a cc? It's quite literally free money (rewards/points + you can delay payments for a month and pay no interest)

As a matter of principle, I don't accept "gifts" from a bank or financial institution, because there's no such thing.

As a matter of principle I do +EV trades

Re: Debit cards are hidden financial infrastructure

#388

Post by vel0city » Mon, Nov 15, 2021, 1:56 AM UTC

simonbarker87 wrote: post #182

aynyc wrote: post #4

Use credit card, it’s the card issuers that are on the hook for fraud. It’ll help you build credit. Use debit when you don’t have the means or credit history.

This is a strong US vs the rest of the world difference. In the UK for example most people will do their day to day spending on debit because the rewards we get aren’t worth the faff of paying for things a month later, when you are less “flush” (Americans just seem to have a lot more money sloshing around compared to even well paid Brits and Europeans) it’s much harder to manage that monthly offset from salary paymen…

You miss out so much paying debit for things in the US. Most transactions net me 2-3% discount, I get baked in additional travel insurance on all travel I book with it, extra warranty on everything I buy, charge backs are easy when things go wrong, and if there's fraud I'm not out cash while things get investigated.

A friend did all her banking in a single checking account. Her card was duplicated and completely wiped out. She filed with the bank for fraud charges. It took almost a week before most charges were wiped out. All the while she had literally no money to eat, buy gas, etc. If that was a credit card, it wouldn't matter. She would still have all her money. She could easily just use a different line of credit, use cash, or use her debit card.

So paying a debit card gets you far less benefits and depending on viewpoint carries higher risks. But the benefit is you (sometimes) can't spend cash you do not have.

Re: Debit cards are hidden financial infrastructure

#389

Post by vel0city » Mon, Nov 15, 2021, 2:25 AM UTC

tasogare wrote: post #23

aynyc wrote: post #4

Use credit card, it’s the card issuers that are on the hook for fraud. It’ll help you build credit. Use debit when you don’t have the means or credit history.

What? That seems totally backwards. Don't spend money you don't have, which mean using debit. Credit is useful for the single use case of buying a house.

I took a loan on a new car. It is 0.9% APR. It's easy to have your money grow faster than that, so leaving my wealth invested and paying the payment nets me more money in the end than if I paid it up front. I could take money out of my investments to pay off the car tomorrow, but with the markets being as they are that would be insane. Even the bonds I own have higher returns than 0.9%.

Re: Debit cards are hidden financial infrastructure

#390

Post by vel0city » Mon, Nov 15, 2021, 2:38 AM UTC

w3ll_w3ll_w3ll wrote: post #316

rootusrootus wrote: post #294

Earlier quoted context omitted.

> Lost your debit card for some reason? Just a simple click in your online banking app on your phone is enough to block the current one and recieve a new card the day after. This is how it works in the US as well. What you haven't addressed is how you get money back in your debit account if someone manages to steal it. For that period of time, you are out the money until the bank resolves it. By definition, this is n…

The contract I have with my bank (Italy) states that in case of dispute they will refund the money immediately (end of the working day). Then they take some time to review the transaction and then they can take their money back if they think my chargeback request was not legitimate.

> end of the working day

You go to the bar Friday night. Bar tender steals your cards info and starts making fraudulent charges. You wake up Saturday with zero money. End of working day refund means you have no money until end of day Monday.