Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Capital One to buy Discover Financial in $35B stock deal

reuters.com

Post reply on HN
Print view View original

41–50 of 127 posts

Re: Capital One to buy Discover Financial in $35B stock deal

#41

Post by hombre_fatal »

LeafItAlone wrote: post #23
KennyBlanken wrote: post #18

Earlier quoted context omitted.

I know someone who wasted two years trying to use a capital one secured credit card to help rebuild their credit history. The initial card offer was a $300 secured card and they figured it was the best they could do, ho hum, and just patiently plugged away For two years, they used the card routinely, paid if off religiously...sometimes having a monthly spend three times the limit. They would periodically request eith…

That certainly sucks, but also kind of makes sense? Once they had the additional data that another company evaluated them as trustworthy, their trustworthiness to Capital One seems to have gone up. They didn’t want to be the only one bearing risk.

Meanwhile Discover’s secured card offering becomes unsecured in six months and they give you periodic updates on how much time is left and how you’re doing.

My experience with the Capital One secured card is the same as their story.

And the difference between the two companies here is the difference between them in every way.

Even little stuff like when I give my info to Discover’s customer support robot before I talk to a human, the human has all the info. Meanwhile when I do the same with Capital One customer support, I usually need to give the same info to the human again.

Re: Capital One to buy Discover Financial in $35B stock deal

#42

Post by scarface_74 »

KennyBlanken wrote: post #18
BadHumans wrote: post #6

I've always heard Discover was a good company to work for and they had the best customer support. Capital One is the opposite of both of those things so I hope the government steps in here.

I know someone who wasted two years trying to use a capital one secured credit card to help rebuild their credit history. The initial card offer was a $300 secured card and they figured it was the best they could do, ho hum, and just patiently plugged away For two years, they used the card routinely, paid if off religiously...sometimes having a monthly spend three times the limit. They would periodically request eith…

I don’t see the harm. The secured card did its job

Re: Capital One to buy Discover Financial in $35B stock deal

#43

Post by scarface_74 »

AzzyHN wrote: post #12
MuffinFlavored wrote: post #3

> The deal, which is expected to receive intense antitrust scrutiny, So... it is highly possible/more than likely it will not go through?

I mean, T-Mobile bought Sprint. Antitrust laws might as well not exist in America

This is completely different. If T-Mobile hadn’t bought Sprint, Sprint would have gone out of business. It had bedn losing money for years.

Then the spectrum they had licenses to - the main reason T-Mobile wanted sprint, would have been auctioned off and probably still would have had t-mobile buy it since they needed it the most.

Besides At&T was already dealing with a ton of debt and if Verizon had bought it, the landscape would have been less competitive

Re: Capital One to buy Discover Financial in $35B stock deal

#44

Post by KennyBlanken »

LeafItAlone wrote: post #23
KennyBlanken wrote: post #18

Earlier quoted context omitted.

I know someone who wasted two years trying to use a capital one secured credit card to help rebuild their credit history. The initial card offer was a $300 secured card and they figured it was the best they could do, ho hum, and just patiently plugged away For two years, they used the card routinely, paid if off religiously...sometimes having a monthly spend three times the limit. They would periodically request eith…

That certainly sucks, but also kind of makes sense? Once they had the additional data that another company evaluated them as trustworthy, their trustworthiness to Capital One seems to have gone up. They didn’t want to be the only one bearing risk.

There is no additional risk if the customer offers a higher security deposit to raise their "credit" limit on a secured card.

They get the interest on the deposit and lower costs (fewer transfers per month paying off the balance of the card.) They didn't care.

Re: Capital One to buy Discover Financial in $35B stock deal

#45

Post by coder543 »

MuffinFlavored wrote: post #40
przemub wrote: post #33

Earlier quoted context omitted.

Not really, no. It's more than enough for them to operate on. The only downside from the American point of view is that banks very rarely offer cashback, points, etc.

> In Europe, credit card processing fees are generally lower compared to other regions, partly due to regulatory caps on interchange fees. For consumer debit and credit cards issued within the European Economic Area (EEA), the interchange fees are capped at 0.2% and 0.3% of the transaction value, respectively. However, total processing costs for merchants can be higher once all fees are included, often ranging from 1…

You seem to be quoting ChatGPT, and you're not even specifying that it's ChatGPT-4, so I automatically assume ChatGPT-3.5, which hallucinates at an astonishing rate. Regardless, all current LLMs can hallucinate. As ChatGPT's disclaimer says, "ChatGPT can make mistakes. Consider checking important information."

A non-GPT source: https://www.lendingtree.com/credit-cards/articles/na-vs-eu-i...

Quoting the relevant statement: "American merchants pay, on average, 1.76% in interchange fees – compared to a 0.96% average in most European nations."

Most of the other sources I'm seeing are quoting even lower numbers. Transactions do seem to have less overhead in Europe than North America.

Re: Capital One to buy Discover Financial in $35B stock deal

#46

Post by RHSeeger »

toomuchtodo wrote: post #39
xp84 wrote: post #36

Earlier quoted context omitted.

Regarding your New Republic link: I find a lot of these kinds of critiques of subprime lending to be disturbingly patronizing. The notion that some third party (the government, presumably) ought to be decreeing that people whose credit is (in this article’s words) so bad that they can’t qualify for a $300 limit at 27% interest, should just not be allowed to access legal credit at all. Terms get worse as you prove you…

Colorado’s HB1229 became law, and several other states have pending consumer lending legislation capping rates at 25%. You can’t fix humans (especially when they’re forced to exist in this dystopian economic system), but you can reduce the exploitation with legislation. Even adults need protection, depending on circumstances, and their status as an adult isn’t a free pass to harm. But heh, that’s just the law. We can…

> Even adults need protection, depending on circumstances

I think the argument is that it's not protection. If someone won't lend to you at 25% (but they would at 27%), then you can't borrow. Is it protection to just prevent those people from borrowing at all?

Re: Capital One to buy Discover Financial in $35B stock deal

#47

Post by toomuchtodo »

RHSeeger wrote: post #46
toomuchtodo wrote: post #39

Earlier quoted context omitted.

Colorado’s HB1229 became law, and several other states have pending consumer lending legislation capping rates at 25%. You can’t fix humans (especially when they’re forced to exist in this dystopian economic system), but you can reduce the exploitation with legislation. Even adults need protection, depending on circumstances, and their status as an adult isn’t a free pass to harm. But heh, that’s just the law. We can…

> Even adults need protection, depending on circumstances I think the argument is that it's not protection. If someone won't lend to you at 25% (but they would at 27%), then you can't borrow. Is it protection to just prevent those people from borrowing at all?

Yes. Usury law serves this purpose, to draw a line.

https://www.law.cornell.edu/wex/usury

At least in the case of auto loans, usury limits do not limit subprime credit access. If you want to refer specifically to deep subprime unsecured model profitability, if it’s profitable, clearly there is room for margin compression through interest rate limits.

https://www.fdic.gov/analysis/cfr/consumer/2015/presentation...

Re: Capital One to buy Discover Financial in $35B stock deal

#48

Post by nonethewiser »

BadHumans wrote: post #6

I've always heard Discover was a good company to work for and they had the best customer support. Capital One is the opposite of both of those things so I hope the government steps in here.

> I've always heard Discover was a good company to work for and they had the best customer support. Capital One is the opposite of both of those things so I hope the government steps in here.

You want the government to step in because you don’t like what you’ve heard about capital one’s customer service and work culture?

Re: Capital One to buy Discover Financial in $35B stock deal

#49

Post by crazygringo »

KennyBlanken wrote: post #18
BadHumans wrote: post #6

I've always heard Discover was a good company to work for and they had the best customer support. Capital One is the opposite of both of those things so I hope the government steps in here.

I know someone who wasted two years trying to use a capital one secured credit card to help rebuild their credit history. The initial card offer was a $300 secured card and they figured it was the best they could do, ho hum, and just patiently plugged away For two years, they used the card routinely, paid if off religiously...sometimes having a monthly spend three times the limit. They would periodically request eith…

Nothing unusual about that at all.

They didn't have good credit, so the Capital One card helped them establish it.

Then they got a better card with another company based on that credit.

Now having two cards improves your credit further, as well as using a lesser proportion of your overall credit. So Capital One upgraded their card.

Literally all of this is working as intended and it's just credit score algorithms. Your friend didn't waste two years on the Capital One card -- they built credit history with it.

Re: Capital One to buy Discover Financial in $35B stock deal

#50

Post by NoPedantsThanks »

lvl102 wrote: post #11

Visa and Mastercard and their highly anticompetitive tactics early in the network landgrab for the payment card space foretold what would happen in the tech space (that is to say do whatever you can to win the landgrab which is exactly what Google/FB did). DFS never caught on. Now the landscape has changed and this deal sort of serves as a bookend. People in fintech should go after the Visa/MC monopoly. There is no “…

Not to mention that retailers are getting screwed harder all the time. I thought that the major cards had set fees across their brands, but NO: retailers are screwed at all different levels by different ISSUERS. Apparently Capital One is one of (if not THE) worst, coming in at something obscene like 4.5%.

That's the entire profit margin of some businesses. At least some places like L.A. are taking tiny steps to prevent a total takeover by these assholes by outlawing "cashless" businesses.

Post reply on HN