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Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

finance.yahoo.com

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Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#51

Post by BadBadJellyBean »

basisword wrote: post #16
BadBadJellyBean wrote: post #6

I hope that they don't fall into the same trap that a lot of EU projects fall in to: only solving one problem. My VISA card is not only a convenient payment method, it also forces ATM operators to give me cash without any extra fees. In Germany the EC card used to be THE way of paying with a card but you had to go to the ATMs of your bank, otherwise there would be sometimes pretty ridiculous fees. The kicker was that…

I'd rather they didn't waste time worrying about ATM's. I have used one once in the last 5 years. Almost everywhere I visit regularly doesn't even take cash now. The problem being every requirement you add to something like this is probably years of development time given it's the government(s) involved.

Germany is different. I don't need cash often but sometimes it's needed.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#52

Post by t-sauer »

FooBarWidget wrote: post #7

??? Doesn't Europe already have Wero (iDEAL in Netherlands)? That's a system for making online payments. Money gets directly debited from your bank account. I've always found credit cards stupid. You just want to pay for something, and then suddenly you have a debt. You shouldn't be in debt when you can clearly pay with money you have. Credit card companies advertise with "super easy payments" and "buy now pay later"…

I assume you never really interacted with the credit card world? E.g. most banks in Germany will give you a credit card that automatically deducts the outstanding debt at the end of the month, you can't really collect debt over time.

In addition I can deposit money on my credit card, so effectively I never have to be in debt if I don't want to. I just have to charge it up which is done in like 3 seconds in the banking app. It can even be automated.

Lastly credit cards with bonus programs definitely exist in Europe. Cashback variations are the most common ones, but all kinds of programs exist. E.g. Eurowings has one https://www.eurowings.com/de/ihre-vorteile/kreditkarten/uebe...

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#53

Post by poisonborz »

freediddy wrote: post #23

How does digital euro replace credit cards? That's basically the same as direct debit. It doesn't address the reason why I use credit cards. I use credit cards as a proxy for my bank accounts. I know that my issuing bank will protect me from all fraud so I don't have to worry about losing money if I buy something from a fraudulent merchant. I also know I can do things like chargebacks if I have to. None of this is ad…

In EU most people use direct debit. The term "credit card" is almost synonymous with debit. Chargebacks theoretically exists but they are more complicated, I don't know anyone who ever did that.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#54

Post by BadBadJellyBean »

looperhacks wrote: post #30
BadBadJellyBean wrote: post #15

Earlier quoted context omitted.

I don't know how but AFAIK VISA has a contract clause that prohibits the issuing bank from charging their customers fees for using other ATMs.

That doesn't help you if the ATM provider charges you, though?

True but that doesn't seem to be a thing here.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#55

Post by blenklo »

xxpor wrote: post #24
FooBarWidget wrote: post #7

??? Doesn't Europe already have Wero (iDEAL in Netherlands)? That's a system for making online payments. Money gets directly debited from your bank account. I've always found credit cards stupid. You just want to pay for something, and then suddenly you have a debt. You shouldn't be in debt when you can clearly pay with money you have. Credit card companies advertise with "super easy payments" and "buy now pay later"…

Europeans being so scared of debt is so funny. Just pay off your card every month. The liability model is completely different in the US from Europe w.r.t. merchant vs bank. The interchange fees are much much higher in the US, which is what pays for the rewards. Europe has an artificial cap.

Your liability comment would mean though that the EU should use it and USA shouldn't.

EU has low fees for transfer, USA has high fees for transfer but apparently its easier for an US Citizen to dispute something.

At least as far as i'm aware, if i send money to someone else, its gone.

Whats that artifical cap?

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#56

Post by dgellow »

FooBarWidget wrote: post #7

??? Doesn't Europe already have Wero (iDEAL in Netherlands)? That's a system for making online payments. Money gets directly debited from your bank account. I've always found credit cards stupid. You just want to pay for something, and then suddenly you have a debt. You shouldn't be in debt when you can clearly pay with money you have. Credit card companies advertise with "super easy payments" and "buy now pay later"…

The way I understand it the Digital Euro doesn't compete with Wero. It's a way for the European Central Bank to emit money in digital form. In theory that doesn't require bank accounts, and can support offline transactions. It's a pretty different concept, more like a new form of money.

Wero, SEPA, and the digital euro are complementing each others

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#58

Post by Dries007 »

xxpor wrote: post #24
FooBarWidget wrote: post #7

??? Doesn't Europe already have Wero (iDEAL in Netherlands)? That's a system for making online payments. Money gets directly debited from your bank account. I've always found credit cards stupid. You just want to pay for something, and then suddenly you have a debt. You shouldn't be in debt when you can clearly pay with money you have. Credit card companies advertise with "super easy payments" and "buy now pay later"…

Europeans being so scared of debt is so funny. Just pay off your card every month. The liability model is completely different in the US from Europe w.r.t. merchant vs bank. The interchange fees are much much higher in the US, which is what pays for the rewards. Europe has an artificial cap.

Almost all EU credit cards are automatic debit at the end of the month, i.e. carrying over balance is not even possible. You will simply be over-drafted on the linked debit account and charged a fee + steep interest if you spend more then you have. Typically until the overdraft is resolved, no further debit card payments can be made.

The only reasons to use a CC in EU are:

- online payments where CC is the only accepted form of payment

- delay payments until after receiving wage

- hotels, car rentals, and other places that lock an amount on your card

- extra insurance provided by some more premium cards (VISA Gold etc)

Ever since 3-D Secure (2FA for CC transactions, beyond the CCV code), you have been liable for any transaction that was validated by it. Your bank may still do a chargeback as a courtesy, but that's not guaranteed.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#59

Post by Insanity »

petcat wrote: post #4

This seems different than a credit card account though? I buy everything with my credit cards because I don't want to swipe my bank card at random merchants.

This tells me you are likely from North America?

Credit Card usage is really different between those regions. While I lived in EU, I rarely used credit cards (even paying online works with debit cards). But in Canada/US, I almost exclusively pay with credit cards now when shopping. Although in fairness it took me a few years to get in the habit of using credit cards and 'collecting points'.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#60

Post by Hikikomori »

freediddy wrote: post #23

How does digital euro replace credit cards? That's basically the same as direct debit. It doesn't address the reason why I use credit cards. I use credit cards as a proxy for my bank accounts. I know that my issuing bank will protect me from all fraud so I don't have to worry about losing money if I buy something from a fraudulent merchant. I also know I can do things like chargebacks if I have to. None of this is ad…

We just don't have that much fraud instead.
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