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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

#791

Post by pydry »

ApolloFortyNine wrote: post #155
mentalgear wrote: post #35

Would be nice of the EU to provide a digital payment service quasi free of charge - without commercial provider's typical predatory fees and other costs. And don't counter with "privacy" .. it's not like all the American companies already have to provide backend access to their data to the NSA and other 3 letter agencies.

The problem with these is always who pays for fraud. With credit cards, they actually claw that money back from the merchant, and then if the merchant can't pay they just eat it themselves. So the merchant has to work in fraud rates into their pricing, and the credit card company has to work in fraud rates that the merchant can't cover into their rates. It always seemed toxic it to me that the merchants are the one's…

Given that visa and mastercard just dump the liability on the merchant, The EU could hardly do worse.

It would be an economic boon to the bloc if they assumed more of the risk.

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

#792

Post by AdamN »

jasonfarnon wrote: post #551
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 had no idea visa/mc didn't bear the cost of fraud. I remember Paypal almost getting killed by fraud in the early days, and I always thought of Paypal as basically replicating visa/mc for online purchases. I didn't realize they were doing so much more than visa/mc by assuming fraud risk.

PayPal was a counterparty so if one side didn't pay or there was a dispute then PayPal was stuck in the middle. Visa and MC are just payment networks and have minimal risk. The only risk I think would be criminal liability (handling drug money) or maybe if the bank goes bankrupt before the payment is due to the merchant (but even that might be borne by they merchant - not sure).

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

#793

Post by hocuspocus »

port11 wrote: post #420
severino wrote: post #135

Whatever they come up with, I hope it doesn't tie you to a Google or Apple smartphone. Can't we have cards for this? In Spain, for example, to use Bizum, you need either an Android/iOS smartphone (and for the Android case, as you use it from your bank's app, it would typically require some Google security assurances - so no Huawei phones allowed, for example) or logging into your bank's website and use Bizum from the…

I don’t see why they can’t just piggyback on existing, proven solutions such as Bancontact, Carte Bleu, etc., which are all based on a card running on its own network. If it’s app-based, we’re excluding quite some citizens from it.

Some of these are 40+ years old.

It makes sense to build upon modern SEPA payment rails and focus on mobile wallets. Europe has always been on the forefront (Swish, Vipps, ...) and we have entire generations of consumers who barely if ever use plastic cards.

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

#794

Post by KronisLV »

AdamN wrote: post #790
severino wrote: post #135

Whatever they come up with, I hope it doesn't tie you to a Google or Apple smartphone. Can't we have cards for this? In Spain, for example, to use Bizum, you need either an Android/iOS smartphone (and for the Android case, as you use it from your bank's app, it would typically require some Google security assurances - so no Huawei phones allowed, for example) or logging into your bank's website and use Bizum from the…

Cards are really slow and expensive to distribute and (tech forward) people would also prefer to just use their phone or watch. This is the kind or project that will take years to work and almost everybody now has a smartphone on one of those two operating systems in their pocket every time they leave the house. Cards will have a slow demise over the next 10 years but it's coming whether we like it or not.

Support both?

Like to log into e-banking services over here we either have phone apps, or a code calculator device that can be used instead of those: https://www.seb.lv/en/private/daily-banking/tools-and-online...

Seems like common sense to me, the same how I have a wallet on my phone but still carry cards for payments just in case.

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

#795

Post by hocuspocus »

MrDresden wrote: post #669
ajsnigrutin wrote: post #50

Earlier quoted context omitted.

Not in EU. https://eur-lex.europa.eu/EN/legal-content/summary/fees-for-... > Specifically, the regulation: > caps interchange fees at 0.2% of the transaction value for consumer debit cards and at 0.3% for consumer credit cards;

These regulations were the reason that American Express pulled out of various European markets (but not all) as it became less/not profitable for them to issue their cards in those markets.

Completely false. They don't apply to 3-party systems.

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

#796

Post by kakacik »

Etheryte wrote: post #788
eastbayjake wrote: post #97

Earlier quoted context omitted.

I'm a little shocked that of all the comments so far, no one has mentioned the financial risk borne by this whole value chain. OP is operating as if it's just a debit system moving money from one account to another but: - For many consumers there isn't sufficient money in the account to settle all the one-time and ongoing transactions they are liable for -- credit cards are giving you a revolving loan, there's risk i…

This shows a fundamental understanding about the market you're commenting on. The European market is nothing like the US market. The vast majority of transfers are already debit based. Most people have a credit card, but for most part it's not a daily driver. Many European countries don't have credit scores at all, and in the ones that do, it isn't nearly as important as in the US. Since there isn't much of a practic…

Yeah very disconnected comment I agree, Europe is different (and dare I say better or more stable long term in this regard).

I have credit cards for decades with various institutions, but NEVER EVER went to minus, see no reason to change it. Just a bit of discipline. We don't have public credit score or similar dictatorial stuff here. The only loan I will ever have on my name is called mortgage on real estate, and beyond that is a line I'll never cross. Same goes for everybody I know - family, friends, coworkers.

This comes from somebody working for a bank so not some clueless fool.

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

#797

Post by dontwannahearit »

joe_mamba wrote: post #778
a-french-anon wrote: post #776

Earlier quoted context omitted.

Read your third link, please. The Ministry of Truth not being happy that their policy on "disinformation" isn't being applied as strongly as they wish isn't what I'd call "pushing heavy propaganda".

Yep. Color me shocked that the propaganda state media is unhappy with information being spread that doesn't conform to the views of the state, and so calls it propaganda or mis-/dis-information. It's totally not the "ministry of truth".

GP means "Ministry of Truth" in the Orwellian-sense. The "Ministry of Truth" was the propaganda arm of the government just as the "Ministry of Love" is the interrogation/torture and brainwashing center.

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

#799

Post by cbsmith »

johanyc wrote: post #743
juliangmp wrote: post #716

Earlier quoted context omitted.

I never understood the credit card thing Why would I want to spend money on loan by default? Why do the Americans do that all the time? What's the benefit?

For consumers, the risk of fraud is bear by the bank, not you, because you're spending the bank's money instead of yours. For banks, they make money through interests from the customers that don't pay off the bill each month.

They make more of their money from transaction fees and selling transaction data. The interest is a nice bonus.

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

#800

Post by tlogan »

ekjhgkejhgk wrote: post #8

I always find it entertaining to hear people try to argue that what these companies do is soooooo difficult and that's why they're valuable. It's just multiple computers keeping a balance. It's not complicated. No, these companies keep themselves in power not because they've solved such a difficult problem that nobody else can, but because they have a moat which they protect. Time to do away with these foreign entiti…

I think what people are missing in this conversation is fraud prevention and protection.

Any cross border payment solution, even within Europe, that lacks strong fraud protection is dead on arrival.

But I suspect the fraud problem will be ignored until it cannot be ignored anymore. And then we will go back to square one and try everything again.

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