Europe's $24T Breakup with Visa and Mastercard Has Begun • Hacker News Board

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

#811

Post by zinekeller » Wed, Feb 11, 2026, 11:21 AM UTC

AdamN wrote: post #792

jasonfarnon wrote: post #551

Earlier quoted context omitted.

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).

At least if the failed bank is Japanese, all of it will fall under their deposit insurance program (https://www.dic.go.jp/content/000010138.pdf#page=13), although this is actually a rare guarantee (FDIC and SVB comes to mind).

> Full coverage for deposits for payment and settlement purposes, bearing no interest, being redeemable on demand, and providing normally required payment and settlement services

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

#812

Post by carlosjobim » Wed, Feb 11, 2026, 11:23 AM UTC

IvanK_net wrote: post #765

It should be enough to make it mandatory for banks to let people send money to each other for free, even abroad (within the EU). Then, at the shop, you can simply pay by making a bank transaction through the internet banking (which can be a phone app, a website, etc). The payment details (account number of the receiver, the amount, etc) can be transferred through NFC or a QR code. Money would go directly bank-to-bank…

What is the benefit for the customer? This idea seems to only give minor benefits to businesses and no benefits for customers.

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

#813

Post by tlogan » Wed, Feb 11, 2026, 11:26 AM UTC

direwolf20 wrote: post #217

jlarocco wrote: post #72

Earlier quoted context omitted.

I can't disagree that they have a moat, but it's a hard problem and if it were as easy as you say somebody would be disrupting them already to get a share of that $24T. Just dealing with fraud is a major problem in itself.

Fraud is mostly resolved by the two banks involved. The network is just that, a network.

The problem arises when the banks are in two different countries. If money leaves your account and mistakenly ends up in an account in another country, even within Europe, it can be very difficult to recover.

That is why national payment systems tend to work relatively well. Cross border systems are a completely different challenge.

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

#814

Post by _zagj » Wed, Feb 11, 2026, 11:35 AM UTC

olalonde wrote: post #303

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…

> If you want to switch the world to a debit-based system where economic transactions are limited by cash on hand, I'd argue that's a poorer and less dynamic world than the one we're operating in today. Disagree. Credit has its uses, but debit is superior for the vast majority consumer transactions: lower fees, lower risk, instant settlement, easy P2P transfers, and broader accessibility. That we've become used to cr…

> lower risk, instant settlement

That's ridiculous. Why should I, as a consumer, care about the merchant's "risk?"

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

#815

Post by a_victorp » Wed, Feb 11, 2026, 11:37 AM UTC

avianlyric wrote: post #784

gizmo wrote: post #609

Earlier quoted context omitted.

Because mastercard/visa don't personally bear any risk they are very happy to process refunds and chargebacks in the customer's favor. It's not a perfect system, but it's much better than direct bank debit where the customer has very little recourse. There is also a significant privacy issue. Today my bank can only see the sum total of my credit card purchases but not what I buy and from which vendor. Amex can see wh…

> Because mastercard/visa don't personally bear any risk they are very happy to process refunds and chargebacks in the customer's favor. That’s not how chargebacks and refunds work. Mastercard and Visa are not involved in the vast majority of disputes at all, it’s entirely handled by the card issuer and card acquirer. Mastercard/Visa only get involved in cases where network party has broken one of the technical rules…

Yep. Worked for a bank, they definitely know who you are

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

#816

Post by philipwhiuk » Wed, Feb 11, 2026, 11:37 AM UTC

joe_mamba wrote: post #316

digiown wrote: post #257

Earlier quoted context omitted.

This is really a human right issue. No one should be required to carry an attacker-controlled tracking device, especially not for interacting with the government. It's funny that the EU uses all this mobile attestation BS more than the US does. So much for sovereignty and consumer protection. No monopoly Google can build is as good as the government forcing you to accept their terms.

>No one should be required to carry an attacker-controlled tracking device What about being required to carry a your-own-government-controlled tracking device? Because the US or Chine government can't harm me in Europe via the data they collect from me, But the EU authorities can if they want to, so naturally I fear them more if they were the ones hoovering my data. What are the odds they're using this on-shore tech…

> Because the US or Chine government can't harm me in Europe via the data they collect from me

That's an amusingly naïve perspective. The US government absolutely can harm you, via a multitude of ways.

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

#817

Post by a_victorp » Wed, Feb 11, 2026, 11:38 AM UTC

watwut wrote: post #705

barbazoo wrote: post #298

Earlier quoted context omitted.

Growing up in the EU, living in North America now, it's mind blowing to me how much credit these companies are making available to me. Not that I ever would outside of an actual emergency but I can see how it's tempting to someone who didn't grow up in a financial risk averse society.

> grow up in a financial risk averse society. It is not risk taking, it is a system that not just normalized the debt, but punishes people for not taking it. When you are recommended to use credit card, so you can function on debt, so that you can get better mortgage later on, then the thing in play is not just "risk aversion".

Yeah, that always blew my mind as a non American.

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

#818

Post by usrusr » Wed, Feb 11, 2026, 11:40 AM UTC

robocat wrote: post #500

gdulli wrote: post #309

Earlier quoted context omitted.

Credit cards provide convenience and cash back benefits. Some might prefer to pay cash for everything for ultimate privacy, and that's fine. But credit cards are the compromise I make. I can still pay cash when I think it's appropriate for a given transaction. Using Google or Apple Pay so I can tap my phone instead of my card gives me no extra benefit that I care about and complicates my ecosystem with another party.

> cash back benefits Only in the U.S. In many other countries the processing fees are regulated by the government so the banks can't afford to give you your "cash back".

How dare Europe force card companies to distribute the cost of being poor on all customers. Cashback is effectively a special fee levied exclusively on those who don't qualify.

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

#819

Post by locknitpicker » Wed, Feb 11, 2026, 11:46 AM UTC

joe_mamba wrote: post #730

pyrale wrote: post #712

Earlier quoted context omitted.

> without having to through the effort to twist the arm of US entities every time they want to do that? Right now, it's more like US corpos are try to twist the arm of EU governments [1][2], pushing heavy propaganda to manipulate our elections [3], allying with the US government to do so. And the US government has been threatening EU govts with invasion [4], leveraging US corpos to harm lawful individuals doing their…

[flagged]

> Jacques BAUD and Xavier MOREAU, Swiss and French nationals respectively, were sanctioned by the EU along with a laundry list of Russian nationals, on the accusation of being russian mouthpieces (...)

If this is the best example you can muster, you don't have much of a case.

They are Russian nationals pushing propaganda for a totalitarian regime which has been engaging in wars of annexation throughout Europe and whose threats of nuclear war against Europe are pushed on almost on a daily basis.

https://www.euronews.com/my-europe/2025/12/18/who-are-the-we...

> I would get it if they only did this to russian citizens living in Russia in the current geopolitical context, (...)

They are. Nevertheless, it's stupid to even consider the idea that only foreign nationals can be foreign agents.

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

#820

Post by tlogan » Wed, Feb 11, 2026, 11:47 AM UTC

TulliusCicero wrote: post #497

ApolloFortyNine wrote: post #155

Earlier quoted context omitted.

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…

> The problem with these is always who pays for fraud. I'm curious how India's UPI handles fraud/refunds, as the system seems to have garnered near-universal praise.

India’s UPI is national service so fraud is “relatively easy” to combat but it depends on banks’ responsiveness.

However, i heard from my Indian friends is that UPI fraud is on the raise and becoming a big challenge.

Edit: UPI fraud rate is similar to CC fraud rate but only about ~6 % of the money lost to UPI fraud has been recovered. If this trend continues (fraud pct continues to grow and recovery rate does not improve) UPI system might get into trouble.

Btw, the stats say that the UPI fraud rate is doubling every year for past few years.