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Europe's $24T Breakup with Visa and Mastercard Has Begun

europeanbusinessmagazine.com

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Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#561

Post by hermanzegerman »

aspbee555 wrote: post #525
hermanzegerman wrote: post #457

Earlier quoted context omitted.

No, Card Misuse is their problem either way in the EU

misuse is not what I mean, I am talking about if your card is stolen and someone runs up a bunch of purchases before it gets caught, that money is gone from your account and any fees from overdrafts are the account holders problem to deal with and stress they can entirely avoid if they did not have/use a card tied directly to their bank account. I pay close attention to my bank account (as it is important for rent/im…

> I am talking about if your card is stolen and someone runs up a bunch of purchases before it gets caught, that money is gone from your account and any fees from overdrafts are the account holders problem to deal with and stress they can entirely avoid if they did not have/use a card tied directly to their bank account

Yes that's what I'm talking about too, and it's called misuse. Liability is capped at 50€ as I said. We also don't have any fixed overdraft fees, only a compared to credit cards low interest rate, but this would also be the banks problem in this case. Also you still need a pin to pay or 2FA when paying online for European Cards. So that scenario seems very unlikely anyway.

> I have never had my ATM card compromised as it is for one purpose, the ATM but I have had the credit card stolen from a store I visited (card company caught it as there was a bunch of fraud from the same store, they let me know and they proactively replaced my credit card.

I have never had my card compromised, as it only uses the EMV Chip for payments in the civilized world, which you can't clone, and even then you would still need the PIN to pay, or the second Factor. I also never had my Debit card (what you mean with ATM card) compromised, because it's the same thing.

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#562

Post by hermanzegerman »

cassepipe wrote: post #546
hermanzegerman wrote: post #455

Earlier quoted context omitted.

In Europe your liability for Card Misuse is capped at 50€ for things that happened before you blocked it. Also how would someone misuse it? You need a PIN Code for every transaction anyway, and the EMV Chip can't be cloned like Magstripes. Online Payments need a mandatory 2 Factor Authentication

I have always heard that the 2fa verification really depended on the vendor actually doing that auth so I always scrape the 3 verification number (what is it for anyways ?) at the back of my card. It's just 3 numbers after all.

It's mandatory by law, and it's additionally to the 3 numbers at the back of the card. Usually it works by confirming or denying the transaction on the App of your Issuing bank

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#563

Post by inkyoto »

tlogan wrote: post #351
Havoc wrote: post #19

Earlier quoted context omitted.

> So Wero is not a credit card Neither are visa/MC for the most part. Mostly debit. ;) this isn’t really about the card anyway but the network behind it. This is likely to be similar to the existing European payment systems just wider in scope. There are a bunch already it’s just fragmented and country specific. Sepa wero ideal girocard crates bancaires

I have always wondered what kind of shenanigans Mastercard or Visa did to convince so many banks to use their networks for debit cards. When did banks actually make that switch? It must be relatively recent, because I remember not that long ago my credit union ATM card was not part of Mastercard. Now I have a new one and it suddenly has a Mastercard logo.

Visa/MC cozied up to major national banks in different countries (not just in the EU) and offered them a sweet deal the banks could not resist: ditch the national payment network in favour of our own cards and we will give a slice of each transaction fee. The transaction fees are tiered, with one part of it going to the payment network (Visa/MC) and the bank (card issuer) keeping the other part. For cross-border transactions, there is also (of course) the exchange rate that comes into play, and this is where each bank buffs its transaction profit margin up even further (as each bank sets its own exchange rate rather than using the interbank exchange rate), so…

… banks saw big, no, BIG $$$ and lost their minds. The transition was rather swift: between the very late 2000's and approximately 2015 (give or take a few years), the transition had been complete. Credit cards became a massively profitable and booming business for the banks, with all sorts of loyalty programmes and bonuses (at consumers’ expense, of course, as the banks also jacked up interest rates on revolving credits). Note that all of this took place before national governments stepped in to regulate the transaction fees.

This coincided with the growing allergy of Western governments to owning any critical infrastructure (including payment networks) and the rising trend of outsourcing as much as possible to the private sector. As it is easy to imagine, it did not take long for the national banks already being in bed with Visa/MC to convince their respective national governments to stop investments in maintenance and enhancement of domestic payment networks and delegate the payment processing to the cartel: «they can do it better than you do».

… all of which has led us to where we are right now. Technically, national payments are still alive, but they are more in the contained mode of operation and not in active use or development.

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#564

Post by ninth_ant »

ehhthing wrote: post #173
Mister_Snuggles wrote: post #100

I'm surprised that Canada doesn't seem to be talking about doing this. We've already got a strong payment processing brand with Interac, it's used daily for millions of debit transactions, and supports all the features you'd expect (in Canada) from a payment card (tap, chip&pin). There's also the MasterCard Debit and Visa Debit branding which seem to bridge debit transactions to the MasterCard and Visa networks. And…

This would still rely on Visa/MasterCard allowing dual-branded credit cards for overseas transactions, which isn't a very common arrangement. The only market that has this is in Asia where there are UnionPay + Visa/MasterCard dual branded cards and I suspect that the reason they allow this is because the market is huge, especially compared to Canada. Also Interac does not do online transactions outside of some very s…

> This would still rely on Visa/MasterCard allowing dual-branded credit cards for overseas transactions, which isn't a very common arrangement

We can and should make this practice illegal, along with several other anticompetitive policies in this space. Oh no they might hit us with tariffs in response?

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#565

Post by hermanzegerman »

chrisjj wrote: post #529
hermanzegerman wrote: post #466

Earlier quoted context omitted.

After paying 5% Commission to them in the overpriced stores that take it. Great Job, you played yourself

Nope. Merchant pays.

And who pays the merchant? I think you're this close to getting it...

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#566

Post by hermanzegerman »

tremon wrote: post #534
hermanzegerman wrote: post #471

Earlier quoted context omitted.

They discontinued their debit networks Maestro and V-Pay, so they can get 0.1% more commission

And the result of that decision is that Europe is now moving away from both companies, so they will get 0% commission. Real genius move there.

Nah, that's because Trump is a dickhead. Otherwise that plan would have worked just fine

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#567

Post by avianlyric »

eastbayjake wrote: post #501
avianlyric wrote: post #459

Earlier quoted context omitted.

None of what you’ve mentioned has anything to do with Visa and Mastercard. Visa and Mastercard are just payment networks, their whole business is literally just transporting transaction information from payment terminals to banks and payment processors, plus keeping track of all the numbers (which is pretty important). Payment networks don’t provide credit or any kind of liquidity whatsoever, that entirely provided b…

I replied downthread but I used "value chain" deliberately -- there are lots of intermediaries of which the card networks are just one link in the chain -- and the statement above is about risk being borne (and value being created for consumers) by the entire value chain that is different and difficult/impossible in a FedNow-style immediate settlement model: https://news.ycombinator.com/item?id=46964968

Mastercard and Visa also use immediate settlement models and basically always have done. The settlement buffer between end parties is created entirely by entities that are all basically banks.

There’s nothing special about Mastercard and Visa rails that prevents you recreating all the functionality that the broader ecosystem provides, without Visa and Mastercard. Hell all of that functionality could be provided by exactly the same companies and banks that provide it for Visa and Mastercard networks.

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#568

Post by direwolf20 »

dathinab wrote: post #549
direwolf20 wrote: post #241

Earlier quoted context omitted.

A lot of European online stores support asynchronous SEPA transfer. You complete your order, they issue a code and amount of money to send. You send the money with that reference code attached and they don't ship it until they get the money. It works for online order because you might be waiting a week anyway.

yes, but in many cases that is because this payment method predates "modern" online payment and they "just kept it around" depending on what you buy "a lot" can be close to non or close to all In the end it has major issues: on the consumer side - majorly reduced consumer protection compared to e.g. pay pal. If you wire transfer by yourself doing charge backs ~two weeks later after not getting the goods is hard, pote…

Standard legal protections still apply, one of you can sue the other for failing to fulfil the legally binding contract you made when you clicked checkout. Credit card payment can be fraudulent too, in all the same ways.

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#569

Post by tlogan »

tuetuopay wrote: post #552
tlogan wrote: post #344

Earlier quoted context omitted.

I think the misunderstanding is that when I say “credit card,” I do not mean a physical card. I have not used a physical card in years. In the US, when people hear Mastercard or Visa, they usually associate that with a credit card (virtual or physical), meaning the money is not taken directly from your bank account. You pay the balance later, which gives you credit and strong dispute protections. Debit or ATM cards a…

And I thing the misunderstanding here is that Europeans don't really use credit cards: we use the term "credit card" when we should use "debit card", but that's language for you. Literally, you have to go out of your way to get an actual credit card instead of the ubiquitous debit card everybody has. And in Europe, when people hear Mastercard or Visa, they just associate the name with refused payments at points of sa…

I really cannot imagine a world without credit cards. How do you buy Christmas presents, everything in cash? I am half joking.

But that might be one reason why business ideas from the US do not always translate well to Europe, and vice versa.

Re: Europe's $24T Breakup with Visa and Mastercard Has Begun

#570

Post by fsckboy »

prmoustache wrote: post #504
whynotmaybe wrote: post #248

Earlier quoted context omitted.

What does Belgium's capital has to do with this? Do you imply Brussels = European Union?

It is called a metonymy where you substitute a name that is associated to some other thing instead of mentionning that thing. Some examples: Wall Street = NY Stock Exchange the White House = US president and his cabinet the Pentagon = US Dept of Defense Downing Street = UK prime minister https://en.wikipedia.org/wiki/Metonymy Scotland Yard = Greater London Metropolitan Police Tehran = Government/officials of the isla…

>It is called a metonymy

or called synecdoche (square/rectangle)

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