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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?

#471

Post by diffeomorphism »

RHSeeger wrote: post #275
Jensson wrote: post #171

Earlier quoted context omitted.

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%.

Most places charge extra for any payment because of the high credit card cost. So you pay the 3% even with cash. Same reason quite a few restaurants have a sign with cash only. Same reason lots of restaurants in Europe had cash, card only for 20€+, no credit card (EC card was <1% fee, credit like 3% so they said no thanks).

Re: Can the Visa-Mastercard duopoly be broken?

#472

Post by chrismcb »

hn_throwaway_99 wrote: post #118
philip1209 wrote: post #49

Fraud protection of credit cards is the root of modern e-commerce. In some ways, Visa and Mastercard are the privatized court systems of the internet. If I end up on a random, self-hosted ecommerce site and decide to make a purchase - what guarantee do I have that the item will show up or be as-described? If I bought something through a bank transfer, reversing that purchase would be incredibly difficult. And, suing…

I don't think anyone disagrees with you in terms of the value of credit cards, the issue is whether their fees are worth it. Their huge profit margins, as well as how they previously fought tooth and nail against, for example, allowing merchants to levy a credit card surcharge, suggest that their duopoly position is allowing them to charge exorbitant amounts for their services.

Worth it to whom? It costs money to deal with transactions. Whether that is cash or credit. 3% can actually be easier and cheaper than dealing with large sums of cash

Re: Can the Visa-Mastercard duopoly be broken?

#473

Post by nobody9999 »

deznu wrote: post #378
nobody9999 wrote: post #359

Earlier quoted context omitted.

>Taxi cabs drivers for instance were against being forced to use credit cards until they realized they got larger tips. I only have anecdata about this, but every taxi driver (50+) I've ever discussed CC vs. cash (this is in NYC and limited to medallion taxis) has said they prefer cash every single time . That's mostly because of the 5% CC processing fees on every transaction, as well as delays in receiving their mon…

You're forgetting about taxes though. A lot of cash-based transactions are not declared. Edit: rather, it's easier to not declare cash income, than income from credit cards. Also keep in mind that the taxi company may take a cut of the revenue too.

>You're forgetting about taxes though. A lot of cash-based transactions are not declared.

In NYC medallion cabs, all taxi rides are recorded by the taxi meter in each car. It records the distance and the fare charged, regardless of payment method.

So that's not really the issue.

Re: Can the Visa-Mastercard duopoly be broken?

#474

Post by nobody9999 »

jjav wrote: post #457
nobody9999 wrote: post #338

Earlier quoted context omitted.

>There's no technical reason why bank accounts couldn't be similarly protected, but banks have thus far been successful in preventing such laws from being enacted. My bank's (Chase) policy limits debit card customer fraud losses to the same $50 that the law requires of credit cards. Not sure about other banks, but while I'm not sad that I have this protection, Chase's anti-fraud measures for debit cards (mostly progr…

> My bank's (Chase) policy limits debit card customer fraud losses to the same $50 that the law requires of credit cards. Yes, many banks do. But be aware that when using a debit card, it's just the bank policy of being nice that protects you. They have the right to change that policy on a whim. When using a credit card, that protection is built into the regulations so you can count on it. Always use a credit card, n…

No post body was provided.

Re: Can the Visa-Mastercard duopoly be broken?

#475

Post by benj111 »

philip1209 wrote: post #49

Fraud protection of credit cards is the root of modern e-commerce. In some ways, Visa and Mastercard are the privatized court systems of the internet. If I end up on a random, self-hosted ecommerce site and decide to make a purchase - what guarantee do I have that the item will show up or be as-described? If I bought something through a bank transfer, reversing that purchase would be incredibly difficult. And, suing…

> Visa and Mastercard are the privatized court systems of the internet.

My issue is that that they should be regulated as such.

They shouldn't be allowed to unilaterally withdraw access (eg wikileaks).

Re: Can the Visa-Mastercard duopoly be broken?

#476

Post by Doxin »

snazz wrote: post #198
PaulDavisThe1st wrote: post #146

Earlier quoted context omitted.

This does not negate the parent post at all. You're just describing another deficiency of the US banking system.

Out of curiosity, how do European banks avoid this issue? If my debit card or ACH info is compromised and someone drains my checking account, is there a way to use the stolen funds before the bank/court finishes their investigation?

> If my debit card or ACH info is compromised

There's two ways this could happen, but neither is super easy:

1) You've handed over your physical debit card and it's PIN code to a baddie and not informed your bank. Unlike the security code on credit cards the PIN code is not on the card. Unlike credit cards you need the actual physical card to transfer money.

2) You've given a baddie your online login info and had him send you a QR code which you then scan and approve the amount.

Notable what does not happen, which does with credit cards, is making a payment at a webshop and that webshop then leaking your card info to a baddie. No one other than the bank ever sees the "secret" part of the card info.

Re: Can the Visa-Mastercard duopoly be broken?

#477

Post by Symbiote »

martijnvds wrote: post #455
PaulDavisThe1st wrote: post #441

Earlier quoted context omitted.

Who defines whether a payment is or is not in error? Has the USA really made me that cynical?

You (the account holder) do. Direct debits are instantly reversible for a month (maybe 2?). You'll have to explain to the company that deducted the money why you reversed the charge though, and if it was legit after all you still need to pay them.

There's no time limit for reversing direct debit transactions.

https://www.cleardebit.com/indemnity-claims/

Re: Can the Visa-Mastercard duopoly be broken?

#478

Post by benhurmarcel »

snazz wrote: post #198
PaulDavisThe1st wrote: post #146

Earlier quoted context omitted.

This does not negate the parent post at all. You're just describing another deficiency of the US banking system.

Out of curiosity, how do European banks avoid this issue? If my debit card or ACH info is compromised and someone drains my checking account, is there a way to use the stolen funds before the bank/court finishes their investigation?

It happened to me at a French bank. I got refunded everything within a few days, I just declared it to the bank.

Re: Can the Visa-Mastercard duopoly be broken?

#479

Post by nullfield »

kccqzy wrote: post #302
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…

Zelle is not always instant. There are two ways for a Zelle transaction to clear. The fast one goes through the Visa network, the same network for credit cards and debit cards. The slow ones goes through ACH, which takes several days. It is generally not possible for two recipients to know which network Zelle will use beforehand. ADDENDUM: The official marketing page for Zelle at https://www.zellepay.com/faq/how-long…

Given who owns Zelle and what they do, and that they’re not a bank, I really want zero to do with them. They’re sus AF, IMO, and I’m just waiting for there to be a serious incident.

Re: Can the Visa-Mastercard duopoly be broken?

#480

Post by Symbiote »

diffeomorphism wrote: post #471
RHSeeger wrote: post #275

Earlier quoted context omitted.

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%.

Most places charge extra for any payment because of the high credit card cost. So you pay the 3% even with cash. Same reason quite a few restaurants have a sign with cash only. Same reason lots of restaurants in Europe had cash, card only for 20€+, no credit card (EC card was <1% fee, credit like 3% so they said no thanks).

In Denmark it's not unusual for company credit cards to be charged extra, and foreign credit cards to be charged even more.

(Before 2018, it could also apply to personal credit cards. It seems a step backwards to exempt them, as the national sysetem, Dankort, has much (much!) lower merchant fees, but now there's no incentive for people to prefer it to Visa/MasterCard.)

Legoland example: https://servicecenter.legoland.dk/hc/en-us/articles/20258981...

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