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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?

#271

Post by travisporter »

njarboe wrote: post #154
bcrescimanno wrote: post #108

Earlier quoted context omitted.

That fear isn't irrational at all (at least, it wasn't). About 20 years ago, I had a debit card number stolen and my account was cleared out. It took about a month to get resolved an, in that time, I had some very unpleasant conversations with quite a few people including my landlord about my inability to pay my bills. In the grand scheme, I suppose it didn't harm me--but it was an extremely unpleasant situation to d…

If you want only an ATM card and not a debit card, you might be able to get one. Banks don't advertise it, but I got an ATM only card from Bank of America.

I don’t understand the difference and Google doesn’t help.

Re: Can the Visa-Mastercard duopoly be broken?

#272

Post by klabb3 »

legitster wrote: post #59

I'm pretty confident Visa's dominance is a completely natural monopoly. There are plenty of 3rd party payment options (Amex and Diners' are still both fairly widely accepted) and nothing is stopping consumers from having multiple cards. But I think the network effects are too strong and we are seeing a pretty normal Pareto distribution. Even if you added 20 new market entrants with good coverage, consumers and busine…

Not all, but a lot of fraud can be prevented with good 2FA. Chip+pin is usually hard enough for low effort fraudsters, and it's tried and tested in large parts of the world for decades.

The US has effectively no effective 2FA. Signature is never verfiied in practice, and magnetic strips are dead simple to clone.

Re: Can the Visa-Mastercard duopoly be broken?

#274

Post by sangnoir »

parineum wrote: post #223
mcv wrote: post #204

Earlier quoted context omitted.

No one can drain ky bank account through my payment card either. For one, they lack the authorisation to do so, and for another, there's a limit (which I can change) to how much can be transferred per day.

> For one, they lack the authorisation to do so I suppose someone should tell the criminals. > there's a limit (which I can change) to how much can be transferred per day. I expect many banks/cards have this ability as well. People just don't use it. Hell, I have a virtual card I frequently use on websites that has a $50 limit per day. I'm sure most other companies have something similar available.

> I suppose someone should tell the criminals.

Outside of the US, the banks do tell the criminals - otherwise the banks would be the hook. This is the fundamental difference between the US and the RoW: in the US, fraudulent withdrawals are the depositors problem[1] which banks don't expend too much effort into, elsewhere, it's the banks' problem, consequently banks go the extra mile to prevent fraudulent withdrawals, and when it does happen, are quick to make the depositor whole.

1. This and "identity theft" are emblematic of a mostly American tendency to pass the buck (and losses) to the least powerful and least informed entity (the depositor) for fraud committed against financial institutions using depositor's information.

Re: Can the Visa-Mastercard duopoly be broken?

#275

Post by RHSeeger »

Jensson wrote: post #171
julienb_sea wrote: post #136

Earlier quoted context omitted.

The benefit of credit cards is no one can literally drain your bank account via fraudulent access to a payment card directly tied to your bank (i.e. debit card in US nomenclature). This is a clear benefit regardless of location. Courts are slow and not scalable, and you don't want to be in a scenario where your bank has been drained right before you need to make important payments.

3% of your credit card spend is a steep cost to pay for that security though, they can't clean out all your money if you don't tie all of it to the debit card, just put a months worth there at a time and you are better off with debit unless you get your debit card stolen every year or so. It isn't more work than credit either, instead of paying it off every month you fill it up every month. And for fraud protection,…

1. Most places don't charge extra for a credit card payment.

2. Most cards have a cash-back arrangement, where you earn credits for what you spend.

Together, that means you're generally not paying anywhere even close to 3%.

Re: Can the Visa-Mastercard duopoly be broken?

#276

Post by throwaway2037 »

ars wrote: post #224
lotsofpulp wrote: post #165

Earlier quoted context omitted.

> 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…

> Ideally, the federal government would have already made it a utility available to all They are working on it: FedNow https://www.frbservices.org/financial-services/fednow/about....

Less than 5 years ago, the Hongkong retail bank system used to charge about 50 HKD to transfer money online to another local bank. Absolute highway robbery / price fixing. Most absurd: Writing a check was free. Can you imagine the comparative operational cost??? Later, the central bank introduced an free, instant, money transfer system, and forced all banks to join. Paying my rent suddenly dropped 50 HKD per month!

Re: Can the Visa-Mastercard duopoly be broken?

#278

Post by RHSeeger »

jjtheblunt wrote: post #262
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…

what's a charge back? (not joking: in the US and I don't know)

It's when you tell your credit card company that a specific charge was not valid. Generally because the person/company it was too did not fulfill their end of the transaction. Generally, you're not responsible for the charge until they've looked into it and determined who they believe is at fault.

Re: Can the Visa-Mastercard duopoly be broken?

#279

Post by giovannibonetti »

organsnyder wrote: post #244
humanwhosits wrote: post #217

Earlier quoted context omitted.

I don't want some third party doing the bank transfer, just lets the banks 1:1

You need a network of some sort, unless each bank has to maintain a direct interface with every other bank.

The central bank can do that. That's how it works for instant payments in my country (Pix payments in Brazil).

Re: Can the Visa-Mastercard duopoly be broken?

#280

Post by scarface74 »

humanwhosits wrote: post #217
lotsofpulp wrote: post #165

Earlier quoted context omitted.

> 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…

I don't want some third party doing the bank transfer, just lets the banks 1:1

Zelle is owned by the big banks. I wouldn’t call it a “third party”. In particular, it is owned by Bank of America, Truist, Capital One, JPMorgan Chase, PNC Bank, Wells Fargo, and US Bank.
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