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Can the Visa-Mastercard duopoly be broken?

economist.com

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Re: Can the Visa-Mastercard duopoly be broken?

#161

Post by sytelus »

JumpCrisscross wrote: post #122
hn_throwaway_99 wrote: post #58

Earlier quoted context omitted.

> Is it because some banks still depend on mainframes doing batch processing? Pretty much all banks use mainframes to do batch processing. "SFTP runs the world". I got heavy into fintech a couple years ago, and at first I thought "This is all insane." I was coming from a SaaS world where it's easy to think about transactional guarantees with API calls. I finally "got it" when I realized that pretty much all of our fi…

> Pretty much all banks use mainframes to do batch processing. "SFTP runs the world" This isn't an anachronism. Batched net settlement is inherently cheaper than real-time gross settlement. Canonical example: if I send you $10, then you send me $5 and I send you $2, in net settlement, there is a single $7 transaction; with RTGS there are three transactions of $17. The first system not only has lower transaction costs…

Why should transaction "cost" anything? It is just running arithmetic instruction on a number in a computer. I would argue batch processing makes no sense. If you send me me $10 and I send you $5 and bank wait for a month to run that batch, you might have already been bankrupt and have nothing to send so somehow you sent me money, I never received it and now everything is in big limbo. Transactions should be instant.

Re: Can the Visa-Mastercard duopoly be broken?

#162

Post by gamegoblin »

echelon wrote: post #57
10g1k wrote: post #6

1.4 billion people in China use WeChat to pay for everything. They don't even bother with credit cards.

A single point of failure, leverage, unilateral negotiation, and control. Horrifying for all people and businesses (especially competitors). Real Standard Oil situation there. Not that our own duopolies aren't also problematic.

Since this is China, a better mental model is probably more along the lines of a utility company that is technically private, but in practice under such government oversight that it is quasi-governmental. Any sufficiently large company in China is better thought of as a quasi-governmental entity.

Re: Can the Visa-Mastercard duopoly be broken?

#163

Post by Dannymetconan »

csomar wrote: post #129
pkaye wrote: post #102

Earlier quoted context omitted.

I presume instant payments don't have the chargeback feature of credit card? That is the main benefit I care about credit cards.

My guess is charge backs are probably a US/Canada thing. Many countries have credit cards without the protections. It happens to work in the US because there is a credit score system, high volumes and most people play by the rules.

The EU also has charge backs as well. I would have assumed all credit cards would have this as a feature.

Re: Can the Visa-Mastercard duopoly be broken?

#165

Post by lotsofpulp »

PaulDavisThe1st wrote: post #150
cycomanic wrote: post #103

Earlier quoted context omitted.

As your post illustrates credit cards are really a solution developped for the deficiencies in the US banking system which have been exported to the rest of the world due to the dominance of the US market. 20 years when I was still living in Germany, hardly anyone had a credit card, while everyone was using automatic payments and electronic wiretransfers. I was very surprised when later (about 13 years ago) a US frie…

This, absolutely. It is totally embarrassing to watch my UK family or EU friends interact with their banking systems and compare it with the US. To be fair, things are improving a little bit. But we're still so very far behind the EU banking system. Instant, cost-free transfers between any two accounts, completed faster than you can lift your finger off your smartphone.

> Instant, cost-free transfers between any two accounts, completed faster than you can lift your finger off your smartphone.

This is available to most people in the US via Zelle. I have been using it for nearly 10 years I think.

https://www.zellepay.com/get-started

Ideally, the federal government would have already made it a utility available to all, but for now the functionality is there for those who can get a bank account.

Re: Can the Visa-Mastercard duopoly be broken?

#166

Post by kube-system »

nixass wrote: post #121
cycomanic wrote: post #103

Earlier quoted context omitted.

As your post illustrates credit cards are really a solution developped for the deficiencies in the US banking system which have been exported to the rest of the world due to the dominance of the US market. 20 years when I was still living in Germany, hardly anyone had a credit card, while everyone was using automatic payments and electronic wiretransfers. I was very surprised when later (about 13 years ago) a US frie…

Why would I use credit card at all? Sure it does help when traveling but not much use for it otherwise

1. Free one month loans

2. The law requires banks to pay for any fraud

Re: Can the Visa-Mastercard duopoly be broken?

#167

Post by einpoklum »

xboxnolifes wrote: post #149
nixass wrote: post #121

Earlier quoted context omitted.

Why would I use credit card at all? Sure it does help when traveling but not much use for it otherwise

Why would I not use a credit card? It's essentially a better debit card in every scenario, except for when paying with a credit card has an additional fee.

1. Extra hassle of interaction with a second company other than your bank, extra credentials, tracking balances, etc. etc. When I was living in the Netherlands I had my bank-account-attached Maestro card (or sometimes cash) and that was that. Except when foreign companies needed a credit card.

2. Fees. The whole point of credit cards - for the CC companies of course - is fees.

Re: Can the Visa-Mastercard duopoly be broken?

#168

Post by cowtools »

tossl568 wrote: post #66
odrekf wrote: post #34

Earlier quoted context omitted.

It has much, much better scalability and uptime. The other day the entire LN went down due to 1 bad node. That has never happened, and will never happen in the original Bitcoin design (ticker: BCH).

It has better scalability if you don't care about decentralisation whatsoever and that it's possible that everyone can store a copy of everyone's else's coffee transactions in perpetuity. It's not possible without huge, expensive to run servers, which is why nobody runs a BCH node. Uptime? By what metric? Bitcoin, the real one, has 100% uptime since the fork. The entire LN did not "go down the other day due to one ba…

>It has better scalability if you don't care about decentralisation whatsoever

That is not true by any meaningful use of the word "decentralization". The LN system is markedly worse: https://www.youtube.com/watch?v=sbD0kiTddEs

>If you're a sockpuppet then nobody is buying it sorry, your coin is dead.

If you are concerned about sock-puppet shills, don't be: I have never owned BCH, BTC or any other bitcoin variant and I will attest to the parent comment's arguments. As a bitcoin outsider, it's pretty clear to me that the path BTC took has irreversibly doomed cryptocurrency. If you are a bitcoiner, your coin is dead also.

Bitcoin is the bigger scam. The problem with bitcoiners not taking the BCH/XT fork isn't that the block sizes aren't large enough. It's that the remaining bitcoin community is dedicated to never make a hard fork again. This is not sustainable in the long-run.

Good cryptocurrencies (like cryptonote, zerocoin, etc.) regularly agree on reasonable compromises to improve the security and efficiency of the network (including changes in block size, etc.). With BTC, reasonable discussion has gone out of the window. It completely defies satoshi's original intention. Your community is no longer a good steward of the network. You are just bagholders trying to protect your investements.

Re: Can the Visa-Mastercard duopoly be broken?

#169

Post by munk-a »

nikitaga wrote: post #75
toomuchtodo wrote: post #4

https://www.moderntreasury.com/learn/what-is-fednow > FedNow is an instant payment service for both individuals and businesses. Once launched, the initial transaction limit will be $25,000. This means that FedNow be more useful for small businesses and retail payment needs until it is widely adopted and the transaction limit grows. > In early 2022, the Federal Reserve released pricing and fee details for their real-t…

> Merchants can pass the CC surcharge through; I’d expect them to do so when a very low cost immediate settlement option is available. Canada has had low-cost Interac debit cards for a long time, and although they've been very popular, merchants generally don't impose any credit card fees. Also, even Canadian online businesses generally don't bother implementing payments with Interac online, so for online shopping it…

A significant number of small low margin businesses refuse to accept credit - at least in Vancouver. A large number of foodtrucks and a small number of restaurants will refuse service for credit card customers.

The fee rates are pretty dramatically different.

Re: Can the Visa-Mastercard duopoly be broken?

#170

Post by madrox »

jjcon wrote: post #133
madrox wrote: post #69

I'm just grateful it's a duopoly and not a monopoly. Can you imagine how much worse the situation would be if one company soft-owned the entire space the way Facebook does with social media?

I'm not sure how facebook is a monopoly on really any level (see tiktok, twitter, youtube, snapchat, etc etc). Visa Mastercard duopoly also has 10x the barriers of entry that social media has.

My reasoning was that, across all Facebook-owned properties, they have ~7 billion MAU. All their top competitors combined are roughly half that. [1]

This is all illustrative, of course. My salient point is that monopolies are only really held in check by the law. In this case, at least there's a significant competitor.

1: https://www.searchenginejournal.com/social-media/biggest-soc...

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