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Zenobia Pay – A mission to build an alternative to high-fee card networks

zenobiapay.com

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Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#111

Post by rendaw »

vasco wrote: post #8
bruce511 wrote: post #5

When you start at the wrong premise, you typically end up in the wrong place. The premise is that credit cards (visa / Mastercard) is broken. When actually it works really well. For starters it works everywhere. Online. IRL. In my home country, in foreign lands. Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Merchants might pay 3%, (and ultimately yes, th…

> Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Sellers increase the price by the fee amount, savvy consumers with rewards cards can get back around 80% of that price increase, and regular non-credit-card-with-rewards holding consumers just subsidize the whole thing by paying the extra. It's a tax on people without rewards cards.

And some businesses (that consumers want) just don't exist because they can't be made to fit the card pricing structure. Ex: journalism (subscriptions only)

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#113

Post by stellar678 »

Hunpeter wrote: post #98
vidarh wrote: post #91

Earlier quoted context omitted.

Handling cash costs more on average at least for smaller businesses than typical card fees. It's typical to estimate the cost of handling cash anywhere from 4% to as high as 15% depending on takings and size of transactions.

As someone with little financial knowledge, I'm curious why that is the case and how those estimates are calculated. I've seen stores offering a discount on cash payments, citing card-related fees as the reason.

I kinda wondered about this forever as well. Then one day I was chilling in my local worker-owned cooperative bakery when the Brinks truck came by to do the bakery's cash pickup. Armed driver. Guard waiting next to the truck holding a long gun. Two guys (presumably armed) going into the business to get the cash and take it out to the truck. That's all pretty expensive!

Smaller family-owned businesses will just take cash to the bank - but it's super common for somebody to eventually surveil them long enough to rob them one day as they're transporting the cash to the bank.

It's pricey to handle cash!

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#114

Post by fsflover »

camillomiller wrote: post #66
nottorp wrote: post #57

Earlier quoted context omitted.

> For starters it works everywhere. Online. IRL. In my home country, in foreign lands. Only if Visa/MC agree with the item being sold though. Be careful to not get hobbies that some religious pressure group hates. Today sex, maybe tomorrow rock climbing or fixing your own motorcycle.

OP wasn’t defending VISA policies, they were just realistically describing how taking on CC circuits with this premise is a risky approach that tries to fix a problem potential customers don’t have. What you are saying is in a completely different domain. Personally I think you’re right, but the only way to solve that is regulating the payment giants as a public utility, not picking a fight against a business model t…

A business mode that relies on duopoly is broken and must be regulated.

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#115

Post by ceejayoz »

sneak wrote: post #6
bruce511 wrote: post #5

When you start at the wrong premise, you typically end up in the wrong place. The premise is that credit cards (visa / Mastercard) is broken. When actually it works really well. For starters it works everywhere. Online. IRL. In my home country, in foreign lands. Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Merchants might pay 3%, (and ultimately yes, th…

> Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Just like tariffs, right? Visa/MC is a +1% income tax on most of the economy.

That’s an acceptable fee for the consumer protections I receive.

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#116

Post by haritha-j »

federiconafria wrote: post #51
OsrsNeedsf2P wrote: post #42

This is what product market fit looks like; everyone is trashing various pieces of Zenobia, but it's still getting upvoted because we all want the solution.

Apparently not everyone: https://www.reddit.com/r/CreditCards/comments/1hxiusj/europe...

Living in the UK, I didn't realise rewards were such a big deal in the US. I'm shocked at the resistance though, to me,, its a no brainer to just be charged less in the first place rather than have to keep track of some silly reward system to get back the extra money that they charged me. It's the same reason I prefer Aldi to all the other supermarkets, that make me keep track of some silly reward scheme, plus use my data to sell me more stuff to boot.

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#117

Post by pbhjpbhj »

Hunpeter wrote: post #98
vidarh wrote: post #91

Earlier quoted context omitted.

Handling cash costs more on average at least for smaller businesses than typical card fees. It's typical to estimate the cost of handling cash anywhere from 4% to as high as 15% depending on takings and size of transactions.

As someone with little financial knowledge, I'm curious why that is the case and how those estimates are calculated. I've seen stores offering a discount on cash payments, citing card-related fees as the reason.

Discount on cash IME is because they're not putting transactions through the till (POS) so they can commit [tax] fraud.

Ran a micro business in UK for 15 years, cash cost as much to deposit as card did - employee time (counting, reconciling, making deposit) and bank charges for cash deposits. It also slowed down transaction time (which was almost all IRL).

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#118

Post by lelanthran »

soared wrote: post #2

Super interesting read! I work in payments for context and see tons of different payment methods every day. People tend to find a payment method they like, and really only ever use that one method. It’s very hard to get someone to switch - even if an alternative is better. It’s just so ingrained to swipe that same card, click the same autofill button, etc. Digital wallets did somehow over come this, and those would b…

> Tough problem. You need a Jony Ive on your team to help solve it.

I don't think so. A Jony Ive will not be in a position to solve the actual problem - what use is a non-universal payment mechanism to consumers and to retailers?

I read the linked page and don't see answers to the main adoption problem: how is the purchaser supposed to pay?

1. Purchaser has to download the app? Okay, but purchaser already has a few equivalents on their phone (Pix, etc) - added friction!

2. How does the App get money to make payment? Purchaser has to fund a new account? Okay, but that is more friction!

3. How does merchant accept the payment? Do they need a new payment terminal? Must their payment terminal be updated with new software? Even more friction!

I've worked in the EMV space, even quite recently, and merchants do not want to update and will only do so when forced to. Any new payment system (QR codes, etc) needs around 5 years (maybe more) before it is universally accepted.

The best way, where I am, to rollout a new payment terminal is to pitch it to the banks, who then offer it to the merchants who have accounts with them.

Adding new functionality to EMV terminals is a lot easier these days, since most of the new terminals are Android, and the vendors have app stores for third parties to write software for these terminals (Pax has Maxstore, etc).

Now, maybe I missed it, but I did not see this application on Maxstore, or some of the other stores. I could have missed it, because these stores have literally thousands of payment applications.

The long and short of it is, you came up with a non-universal payment method, and predictably it did not take off.

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#119

Post by pbhjpbhj »

bruce511 wrote: post #5

When you start at the wrong premise, you typically end up in the wrong place. The premise is that credit cards (visa / Mastercard) is broken. When actually it works really well. For starters it works everywhere. Online. IRL. In my home country, in foreign lands. Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Merchants might pay 3%, (and ultimately yes, th…

So a 1980s computer is faster at calculating than a person, so why reduce the cost? Or a car is cheaper to maintain than a horse, why reduce the cost?

Let's flip the script. In reality the averaged transaction _cost_ is probably O(0.1%) or lower. Why are we paying more?

Re: Zenobia Pay – A mission to build an alternative to high-fee card networks

#120

Post by Ekaros »

pbhjpbhj wrote: post #119
bruce511 wrote: post #5

When you start at the wrong premise, you typically end up in the wrong place. The premise is that credit cards (visa / Mastercard) is broken. When actually it works really well. For starters it works everywhere. Online. IRL. In my home country, in foreign lands. Secondly it costs the consumer nothing. The cost goes to the merchant. If anything the customer gets rewards. Merchants might pay 3%, (and ultimately yes, th…

So a 1980s computer is faster at calculating than a person, so why reduce the cost? Or a car is cheaper to maintain than a horse, why reduce the cost? Let's flip the script. In reality the averaged transaction _cost_ is probably O(0.1%) or lower. Why are we paying more?

Decision makers and regulators have been bribed in many places.

EU has actually solved this with interchange fees for consumers being 0.3% which to me sound reasonably close to that 0.1%.

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