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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?

#671

Post by varispeed »

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…

> reversing that purchase would be incredibly difficult

The institutions (at least in my country - UK) are not interested in dealing with that. Police will not view it as fraud (unless they get a massive number of enquiries, but still they may be ignoring for a long time before it comes on their radar), the Trading Standards will say talk to your bank, bank will say I should have done more due diligence. Then you won't be able to take the seller to court if they used fake address. Police will not be interested in finding it for you. You can hire a private detective to locate the seller, which will cost probably many times over the loss. Now even if they locate them, they may not have a permanent residence, which again makes it difficult to lodge the case in court and before it happens you have to first try to mediate. Good luck with that. Basically the current system is created for fraudsters to thrive.

Re: Can the Visa-Mastercard duopoly be broken?

#672

Post by causi »

gretch wrote: post #628
causi wrote: post #574

Earlier quoted context omitted.

I wouldn't require someone to be able to provide change, but "accepting the currency of the nation you live in" seems like it should be one of the basic requirements of civilization.

I bought a house and was required to wire transfer the down payment. Would it have been reasonable for me to drop off a briefcase of cash? Was this transaction somehow unreasonable?

Yes, that would've been reasonable, and it wouldn't have been a briefcase. Fifty thousand dollars in hundreds is a stack less than three inches thick.

Re: Can the Visa-Mastercard duopoly be broken?

#673

Post by BiteCode_dev »

andersonmvd wrote: post #43

In Brazil many stores are dropping credit card and allowing only PIX (instant debit transfer) cause it's cheaper for business (0,22% avg transaction fee vs 1%-2% of credit cards - src (pt-only) https://g1.globo.com/economia/pme/noticia/2022/03/23/pix-e-m... ). The President of Brazilian Central Bank recently said that "credit cards will soon cease to exist" src (pt only) https://www.poder360.com.br/economia/campos-ne…

Does this require a phone and an internet access?

Re: Can the Visa-Mastercard duopoly be broken?

#674

Post by Symbiote »

mellavora wrote: post #537
apexalpha wrote: post #470

Earlier quoted context omitted.

I've never heard of any protection like this in the EU banking system. If you transfer money to a scammer it's simply gone. It sucks for the 0,0001% of people who get scammed some time but is it really needed that the bank takes on this role?

not sure where you get the 0.0001% figure. The protections are part of the regulations. A consumer can reverse a SEPA Direct Debit transaction at any time. This is called a chargeback. A chargeback is allowed up to 8 weeks after the date of the direct debit with a valid mandate and up to 13 months without a valid mandate. At most banks, the consumer does not have to give a reason for the reversal. https://help.mollie…

Direct debits are the thing used to automatically pay your electricity bill every month. A different system with different rules to a one-off personal or business money transfer.

Re: Can the Visa-Mastercard duopoly be broken?

#676

Post by Findecanor »

moffkalast wrote: post #251
atombender wrote: post #191

Earlier quoted context omitted.

...In the US. Outside the US, credit cards are much less common outside the US. The alternative to credit cards isn't CoD, it's debit cards, which are connected directly to a bank account. Merchants love debit cards because they have near-zero transaction fees. You don't need credit card for chargebacks, just strong consumer protection laws that permit the bank to claw the money back from the merchant. As for fraud,…

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…

I've had both VISA and MasterCard debit cards, delivered from my Swedish bank. Both had 16-digit card numbers, not my bank account number.

The only hick-up is that they default to 2FA: using a smartphone (domestic bank system) or card-reader (chip-and-pin). My bank has supplied me with a small card-reader for home use, which I also use for on-line banking. To order from an on-line vendor that does not support chip-and-pin, I'd have to also log into my bank and temporarily enable "Internet payments". This has worked for me every time I've ordered from US, Australia or Japan.

Re: Can the Visa-Mastercard duopoly be broken?

#677

Post by BiteCode_dev »

CharlesW wrote: post #620
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…

There is this naive modern believe that killing people is something exceptional and difficult.

It's not.

1 out of 2 homicide is unsolved in the US: https://www.statista.com/statistics/194213/crime-clearance-r...

As for straight murder, it's the cause of death of 5 persons out of 100000 (https://ucr.fbi.gov/crime-in-the-u.s/2019/crime-in-the-u.s.-...). Diabetes is 20/100000 in comparison (https://www.cdc.gov/nchs/products/databriefs/db427.htm).

And that's mostly by people with no master plan for the killing in the first place.

If you die, NCIS will not come to your house to do a full tv show like murder solving. They will send an average joe cop, probably eating a sandwich on the murder site putting his print and crumbs everywhere, he will suspect your close ones, and ask a bunch of questions, because that statistically the only thing that works well. If the killer is obvious, it's solved. If not, nobody will ever know.

Re: Can the Visa-Mastercard duopoly be broken?

#678

Post by grgbrn »

lotsofpulp wrote: post #165
PaulDavisThe1st wrote: post #150

Earlier quoted context omitted.

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…

Zelle doesn't support all banks - the call to action on their home page is even "See if your bank offers Zelle". My credit union, sadly, does not. So it's not really comparable to EU IBAN transfers.

Re: Can the Visa-Mastercard duopoly be broken?

#679

Post by sph »

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…

Tangent: this faster payment layer with delayed settlement is exactly how the Lightning Network on top of Bitcoin works.

Re: Can the Visa-Mastercard duopoly be broken?

#680

Post by pumpkinprog »

No problem at all. See Russian example. 10 years ago it was 50/50% Visa/Mastercard on the Russian market. Today it is like 30/30/30 Mir/Visa/MC (Mir is the national payment system). And even those 60% are not "real" Visa/MC, since they are being processed through a centralized platform, owned by the Russian Central Bank. For example, it helped to save all the cards in working condition when Visa/MC exited Russia
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