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Can the Visa-Mastercard duopoly be broken?

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Re: Can the Visa-Mastercard duopoly be broken?

#611

Post by denton-scratch »

notsapiensatall wrote: post #418
pulisse wrote: post #295

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 difference is a consequence of law, not payment technology. It's entirely possible for someone to make fraudulent charges on a card up to its limit (which would be the analogue of draining a bank account), but CC companies are require…

There is a functional difference in how credit/debit cards work, though. With credit cards, you get an invoice with fraudulent charges at the end of the month. You can choose not to pay those charges, citing fraud. The bank will clear the charges if they agree. With debit cards, the money is withdrawn directly from your account. You can report the unauthorized withdrawal, and the bank will reimburse you if they agree…

However, in the UK there is the Direct Debit Guarantee: the company holding your DD mandate can't withdraw more than you mandated, nor on some other date than the date you specify. Otherwise you have a claim against your bank, and they have no defense.

Re: Can the Visa-Mastercard duopoly be broken?

#612

Post by mbesto »

andrewaylett wrote: post #585
mbesto wrote: post #439

Earlier quoted context omitted.

I like Zelle, but this is not comparable to the system I've used in the UK. - Limits how much you can send - Identity is based on email or phone number (what?!) that then needs to be managed/tied to the bank account. If you switch banks or whatever, you need to re-active with the new bank. - For awhile, I could only associated one email with one account in Chase (despite having 4 checking accounts for business, etc.)…

The UK equivalent to Zelle isn't BACS/Faster Payments, but https://paym.co.uk/ As I understand things, the US equivalent to BACS would be ACH. Which is also sort code and account number, but allows pulling money without further authorisation as well as pushing money. Obviously doing that when you're not supposed to would be very illegal, but unfortunately that's not enough to stop everyone.

Yup, that was my point. The OP thinks "we already have this in the US" and its not nearly the same.

Re: Can the Visa-Mastercard duopoly be broken?

#613

Post by denton-scratch »

mcv wrote: post #225
snazz wrote: post #198

Earlier quoted context omitted.

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?

How would they drain your bank account? There's quite a bit of 2FA they'd have to defeat. Easiest is stealing the card after skimming their PIN, but if you know it's stolen, you're going to block it pretty quickly, and there are limits to how much you can withdraw from an ATM. The big problem with credit cards is that all the info needed to authorize a transaction is right there on the card. The second problem is tha…

> The big problem with credit cards is that all the info needed to authorize a transaction is right there on the card. The second problem is that quite often you submit that data directly to the merchant or to whichever payment provider the merchant chose.

Same with my (UK) DD card, when I use it online. I occasionally get challenged by Visa/Mastercard for some passphrase or whatever. For retail purchases, I can usually just swipe. Periodically I'm asked for a PIN.

I prefer DD over CC, because I have full control over my liabilities, should someone try to drain my account, just by adjusting the balance on the account (and I can't link my deposit account with the card; so that's where the rich pickings are kept).

Also, way back when, I was pretty relaxed about credit balances, and the CC company kept raising my limits; I got into a lot of debt. Nowadays I don't use credit unless I'm forced to (which hasn't happened for 20 years). So I have a CC, with a zero balance (and the CC company is going to shut it down, because I'm not using it).

Re: Can the Visa-Mastercard duopoly be broken?

#614

Post by saghm »

selectodude wrote: post #606
wiederholen wrote: post #604

Earlier quoted context omitted.

There is no federal statute mandating that a private business, a person, or an organization must accept currency or coins as payment for goods or services. Private businesses are free to develop their own policies on whether to accept cash unless there is a state law that says otherwise.

I know that. However you must accept cash to settle a debt. It's literally printed on every bill.

To be fair, writing on currency doesn't necessarily have to be legally binding. The bills also say "in god we trust", and yet I'm free to not trust in god and there are no legal consequences.

Re: Can the Visa-Mastercard duopoly be broken?

#615

Post by vimy »

akrymski wrote: post #568
vimy wrote: post #432

Earlier quoted context omitted.

I don’t know about the UK but in my SEPA country only companies can create pull-based schemes and they can’t do it without authorization of the bank account owner. Mostly used for things like utility bills. So there’s zero danger in sharing your bank account number with someone.

1. It's easy to setup a company 2. There's no validation that the direct debit is being setup by the account owner

1. It’s a bureaucratic mess. And scammers will also need to deal with the bank first. 2. With a paper form they need your autograph and other ID data. Or when it’s digital you need to authorize the request with your banking app.

Re: Can the Visa-Mastercard duopoly be broken?

#616

Post by Cu3PO42 »

lomoeffect wrote: post #319
moffkalast wrote: post #251

Earlier quoted context omitted.

The thing about debit cards though, it's a different system and they don't work for online payments which makes them effectively useless. > People seem more wary of accruing debt in Europe; it's easy to lose control over your personal finances with a credit card. Well using credit means you're taking a loan, and subsequently paying interest on that loan even if it's just a month. Why would you pay interest on a loan…

>The thing about debit cards though, it's a different system and they don't work for online payments which makes them effectively useless. Everything in your opening sentence is incorrect.

This very much depends on the country. In some places there are debit card networks which are neither MasterCard nor Visa nor Maestro. In such situations your bank's debit card may actually be useless for online payments. Even if the cards are Maestro and an online retailer happens to accept Maestro (somewhat rare in my experience), that may not help you since banks will often blanket deny any card-not-present transactions.

Re: Can the Visa-Mastercard duopoly be broken?

#617

Post by Cu3PO42 »

gsnedders wrote: post #559
moffkalast wrote: post #497

Earlier quoted context omitted.

Yeah though those aren't true debit cards, at least not in the original sense. They're credit cards that work like debit cards that I mentioned now exist. Actual debit cards are issued by banks and only have the much longer account number on them.

How are they not true debit cards? They are issued by banks, directly debiting from an account. Sure, internally they piggyback on infrastructure originally intended for credit cards, but that's an implementation detail. Maestro, given you mention it elsewhere, doesn't necessarily have longer payment card numbers than most credit cards (which are mostly 16, except for Amex which is mostly 15): it merely has a number…

I think the grandparent may be from a country in which a separate debit network, operated jointly by the nation's banks, exists. In such countries banks have typically issued cards using these networks and they may be seen as "true debit cards". MC/Visa are then often used interchangeably with "credit card", even in instances where they are debit cards on the Visa/MC network. (I'm not arguing this is correct usage of terminology.)

Anecdata: I'm from Germany, which is one such country. I've recently had a conversation with someone who had a "credit card" that charges directly to their bank account.

Re: Can the Visa-Mastercard duopoly be broken?

#618

Post by selectodude »

saghm wrote: post #614
selectodude wrote: post #606

Earlier quoted context omitted.

I know that. However you must accept cash to settle a debt. It's literally printed on every bill.

To be fair, writing on currency doesn't necessarily have to be legally binding. The bills also say "in god we trust", and yet I'm free to not trust in god and there are no legal consequences.

Eh, "This note is legal tender for all debts, public and private" doesn't leave a lot of room for nuance.

Re: Can the Visa-Mastercard duopoly be broken?

#619

Post by jollybean »

thematrixturtle wrote: post #423
jollybean wrote: post #362

Earlier quoted context omitted.

I think this is completely wrong. It's not the 'credit' that drives this, so much as the 'digitization'. That can be achieved without credit. European countries have been doing it for a long time. Canada has 'Interac'. There is utterly no need for VISA/MC. A fairly simple banking standard could make it so that you could pay for stuff with some kind of card + PIN and that's it. There'd be a tiny fee which would help t…

> There is utterly no need for VISA/MC. Unless you're a visitor who doesn't have access to the local system. As a traveller, it's now possible to travel to other countries and never touch local cash, because everything can be paid for by credit card. In the US, tips have historically been the outlier, but while Venmo is increasingly taking over, that's not something you'll have access to without a US bank account.

I suggest you'd be able to get a 'card' on the system that is 'cash only'.

Re: Can the Visa-Mastercard duopoly be broken?

#620

Post by CharlesW »

gsibble wrote: post #561

I actually designed software that could integrate with existing POS systems (the really hard part) that allowed for interchange free commerce using a card or Apple Pay integration. I showed it to an investor. His only response was, "This is a very fast way to end up dead." You don't fuck with monopolies that bring in hundreds of billions to trillions of dollars in profit a year. People get killed for way less. On a s…

> You don't fuck with monopolies that bring in hundreds of billions to trillions of dollars in profit a year. People get killed for way less.

He didn't mean that a corporation would literally kill you, because that comes with the possibility of unimaginable risk. He meant that they had effectively-infinite resources to fight you for decades with an army of lawyers and politicians.

https://en.wikipedia.org/wiki/Robert_Kearns

https://www.opensecrets.org/orgs/visa-inc/summary?id=D000029...

https://www.opensecrets.org/orgs/mastercard-inc/summary?id=D...

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