Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC? • Hacker News Board

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#311

Post by anonzzzies » Sun, Aug 18, 2024, 12:21 PM UTC

jkaplowitz wrote: post #310

anonzzzies wrote: post #265

Earlier quoted context omitted.

mediation/arbitration It already works like that here (eu) for debit cards (which most people have; very few have credit cards although they don't know the difference). Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot); products not as delivered is responsibi…

> Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot) You'd be surprised - at least in the public transit context with iOS Express Mode, double Apple Pay taps by transit systems have absolutely been recorded plenty of times. I admit I haven't heard about this i…

> To be honest, no, the idea that chargebacks are common in the US is a stereotype and not true.

The thing is, even here on HN (where I expect, maybe not warranted, the level to be higher), people seem to absolutely proud and entitled to chargeback whatever for whatever reason. Those are almost 100% Americans (I check) and that is where I got the idea; this sentiment is much higher on tiktok, youtube, reddit etc. I even saw some shorts of people screwing merchants with chargeback like it is some batch of honour.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#312

Post by anonzzzies » Sun, Aug 18, 2024, 12:23 PM UTC

jkaplowitz wrote: post #310

anonzzzies wrote: post #265

Earlier quoted context omitted.

mediation/arbitration It already works like that here (eu) for debit cards (which most people have; very few have credit cards although they don't know the difference). Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot); products not as delivered is responsibi…

> Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot) You'd be surprised - at least in the public transit context with iOS Express Mode, double Apple Pay taps by transit systems have absolutely been recorded plenty of times. I admit I haven't heard about this i…

> You'd be surprised - at least in the public transit context with iOS Express Mode, double Apple Pay taps by transit systems have absolutely been recorded plenty of times.

Where? I heard it many years ago a few times but not for a very long time? Maybe it was a bug which got fixed?

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#313

Post by mensetmanusman » Sun, Aug 18, 2024, 12:28 PM UTC

I wonder if the government could make a new type of physical cash with digital characteristics to solve this.

If we know the grid was at risk of collapse during conflict or a solar event, it might make sense to mandate cash* below some dollar value as an anti fragile move.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#314

Post by sidewndr46 » Sun, Aug 18, 2024, 12:29 PM UTC

Nextgrid wrote: post #120

oldprogrammer2 wrote: post #9

Stripe, Block, and PayPal each solved a massive pain point. PayPal provided a way to pay people and vendors without giving away your credit card number. Square made it easy to accept payment in person on a phone, without an extensive upfront underwriting experience and without expensive fixed monthly fees. Stripe did the same as Square, but for accepting online payments. Fraud and Risk come in many forms, and these p…

A lot of the fraud hinges on the fact that all you need to drain an account is a static card number. A lot of hacks are subsequently piled on top of that to try and make it harder (SCA/3D Secure, captchas, etc), and a lot of busywork is spent tidying up the consequences of that (chargeback handling, etc). You could eliminate a lot of the fraud by moving off a mostly-static identifier to merchant, amount and time-limi…

From a merchant perspective, there is a significant group that view this as a feature. Not a bug. Once a merchant gathers you credit card info, they can submit basically any transaction they want at any time. Yes, if you do this enough your payment processor will cut you off. But for businesses like gym membership, NYTimes subscription, car rentals, etc. it's a core feature.

The product in that case is not "payments as a service" to the consumer but in fact "payer as a service" to the business. If consumers didn't represent an unbounded ability to generate recurring revenue there are lots of profitable businesses that would go under overnight.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#315

Post by mnky9800n » Sun, Aug 18, 2024, 12:42 PM UTC

sidewndr46 wrote: post #314

Nextgrid wrote: post #120

Earlier quoted context omitted.

A lot of the fraud hinges on the fact that all you need to drain an account is a static card number. A lot of hacks are subsequently piled on top of that to try and make it harder (SCA/3D Secure, captchas, etc), and a lot of busywork is spent tidying up the consequences of that (chargeback handling, etc). You could eliminate a lot of the fraud by moving off a mostly-static identifier to merchant, amount and time-limi…

From a merchant perspective, there is a significant group that view this as a feature. Not a bug. Once a merchant gathers you credit card info, they can submit basically any transaction they want at any time. Yes, if you do this enough your payment processor will cut you off. But for businesses like gym membership, NYTimes subscription, car rentals, etc. it's a core feature. The product in that case is not "payments…

I suppose in this system you could white list such things. It would be a box to click when it directs you through the Auth process. I guess you could directly implement this in stuff like Norway's bank id system.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#316

Post by Workaccount2 » Sun, Aug 18, 2024, 12:45 PM UTC

azthecx wrote: post #307

Nextgrid wrote: post #120

Earlier quoted context omitted.

A lot of the fraud hinges on the fact that all you need to drain an account is a static card number. A lot of hacks are subsequently piled on top of that to try and make it harder (SCA/3D Secure, captchas, etc), and a lot of busywork is spent tidying up the consequences of that (chargeback handling, etc). You could eliminate a lot of the fraud by moving off a mostly-static identifier to merchant, amount and time-limi…

Portugal like many European banks already has a working solution to this for 20 years where you can create temporary card numbers and use that instead or, as of late, pay directly through an app that enables this same behaviour. The Netherlands had a similar system where they used physical totp (I believe) terminals which generated them from your bank card + pin, completely offline. Nowadays everyone uses iDEAL ident…

We have had this in the US too for at least a decade, people just don't use them, probably because of convenience.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#317

Post by Nextgrid » Sun, Aug 18, 2024, 1:06 PM UTC

jkaplowitz wrote: post #308

Nextgrid wrote: post #306

Earlier quoted context omitted.

My point is that this would become optional and the cardholder chooses whether to opt-in (and pay an extra fee) at the time of payment. If the cardholder doesn't opt-in then the payment is as good as cash (with the same recourse available as if you paid cash). This could allow low/no-fee transactions for low-stakes situations where the chargeback protection wasn't going to be used anyway.

Ah, you're proposing to remove US credit card customers' statutory right to those chargebacks except if they opt into a surcharge on a per-transaction basis.

Yes, essentially moving the transaction fee the merchant pays to the consumer. This means they can choose whether they want the additional protections those fees currently pay for.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#318

Post by RunSet » Sun, Aug 18, 2024, 1:08 PM UTC

trompetenaccoun wrote: post #218

cedws wrote: post #33

This is why I was excited about Libra (later renamed to Diem.) which was Meta's feeless digital currency that was scrapped. It could have been a Western WeChat Pay, which charges no fees up to 200 RMB ~= 20 GBP. I don't see why they should get to shave a slice off of every transaction. It takes relatively little upkeep and they rake in huge profits. The fees nudge businesses to use cash (well, to avoid tax too, somet…

It was not just "scrapped", they were basically forbidden from going ahead by regulators protecting the incumbents. It's the same problem all cryptocurrency projects face. They allowed Bitcoin because Bitcoin is basically useless for payments, it's too slow and fees are way too expensive. Though Ethereum recently slipping through the cracks may disrupt the payments industry in a big way. Coinbase and Circle are alrea…

> They allowed Bitcoin because Bitcoin is basically useless for payments, it's too slow and fees are way too expensive. Though Ethereum recently slipping through the cracks may disrupt the payments industry in a big way.

Or authorities "allowed" Bitcoin because, given its lack of head to cut off, they had no choice.

Contrast with Ethereum's demonstrable central authority over its blockchain: When the developers were robbed of their coin by a hacker, they "reorganized" the Ethereum blockchain to undo the transactions associated with the theft.[0]

I regard Ethereum less as "slipping through the cracks" and more as a poison suppository greased and inserted by the powers that be.

[0] https://en.wikipedia.org/wiki/Ethereum_Classic#The_DAO_bailo...

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#319

Post by hugs » Sun, Aug 18, 2024, 1:09 PM UTC

kinakomochidayo wrote: post #281

hugs wrote: post #172

Earlier quoted context omitted.

> You could eliminate a lot of the fraud by moving off a mostly-static identifier to merchant, amount and time-limited tokens the user generates with their bank (or the merchant redirects them there). This would address a lot of the issues - the tokens are useless when leaked... This almost sounds like a subtle recommendation for the Lightning Network. It's based on single-use invoices that are locked to a specific r…

Lightning Network will never get widespread adoption because the UX is horrible.

That hasn't been my experience using Alby and Primal's Nostr client. It's been as easy as Venmo.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#320

Post by Nextgrid » Sun, Aug 18, 2024, 1:15 PM UTC

anonzzzies wrote: post #311

jkaplowitz wrote: post #310

Earlier quoted context omitted.

> Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot) You'd be surprised - at least in the public transit context with iOS Express Mode, double Apple Pay taps by transit systems have absolutely been recorded plenty of times. I admit I haven't heard about this i…

> To be honest, no, the idea that chargebacks are common in the US is a stereotype and not true. The thing is, even here on HN (where I expect, maybe not warranted, the level to be higher), people seem to absolutely proud and entitled to chargeback whatever for whatever reason. Those are almost 100% Americans (I check) and that is where I got the idea; this sentiment is much higher on tiktok, youtube, reddit etc. I e…

There's nothing wrong with using a right the card networks explicitly provide you. Even here on HN I see a huge tendency to play fast and loose with access to customer money, and corporation-on-consumer fraud has been normalized and is treated as no big deal. Chargebacks are a normal and expected reaction to that.

I'm sure chargeback abuse is a thing, but in aggregate, I'd argue people are still not doing enough chargebacks, because businesses are still engaging in unethical (& potentially illegal) practices of billing customers for services not rendered, or unclear pricing, or dark patterns.

Dark patterns with regards to payment should be a big no-no, and the fact they're still around suggests this behavior isn't being punished enough. So we should in fact have more chargebacks, until the situation becomes that it's more profitable to play fair and legal than try dirty tricks.

Unlimited, no-confirmation access to pull money just based on a static card number is a bug to begin with - ideally every money movement would be authorized on the spot or preauthorized in advance up to a limit.

But assuming we do have this bug, it seems like merchants are happily abusing it - "free" trials that are impossible to cancel, unexpected charges buried in 50 pages of T&C, etc. Chargeback is a completely normal reaction to this and I recommend it to everyone.

The heuristic I use is simple: did I expect this charge, and would I have agreed to pay for it had I been asked for upfront? If not, the merchant gets a quick email, and if they're not cooperating, taking unreasonable time to action it or are outright unreachable they're eating a chargeback and it'll be up to them & their processor to argue it further. They are welcome to put their processor/acquirer person on hold for hours (like they would do me if I were to play their game) and see how that works out for them.