What do Visa and Mastercard do? An intro to card networks • Hacker News Board

Re: What do Visa and Mastercard do? An intro to card networks

#81

Post by asdff » Wed, Sep 09, 2026, 7:47 PM UTC

toast0 wrote: post #71

asdff wrote: post #65

Earlier quoted context omitted.

Another thing to consider is your credit card rewards cash back etc are really trading your privacy for a little rounding error worth of discount in comparison to using cash. You may also save far more money going cash only. E.g. some local restaurants near me give you like 5% off paying in cash. Gas is generally cheaper cash price vs card price or debit fee. You have a big job with a contractor, tell them you might…

> Another thing to consider is your credit card rewards cash back etc are really trading your privacy for a little rounding error worth of discount in comparison to using cash. How much privacy really? If I get mostly $20s from the ATM, and the merchant does daily deposits of most of the $20s they get, why wouldn't banks start scanning and tracking serial numbers (if they don't already), if my purchasing habits are a…

Make change with your local under the table taco stand

Re: What do Visa and Mastercard do? An intro to card networks

#82

Post by bigbuppo » Wed, Sep 09, 2026, 7:48 PM UTC

losvedir wrote: post #44

I play the credit card "game" because I hate feeling like I'm leaving money on the table, but I really wish I didn't have to. Some degrees of fees make sense, to run the network, and handle fraud, but it's ridiculous that people have this sense that shopping should somehow fund your vacation. Where I am it's increasingly common to see credit card fees when checking out. I get it, because merchants are being charged 3…

What's really fun is when you're reselling something like Microsoft 365 and both the credit card companies and the state (through sales tax) make more than you do on each sale.

Re: What do Visa and Mastercard do? An intro to card networks

#83

Post by vulcan01 » Wed, Sep 09, 2026, 7:48 PM UTC

foobarian wrote: post #67

RobRivera wrote: post #24

Earlier quoted context omitted.

This would explain why so many damn coffee shops dont deal with cash now - the double as a coffee shop and data reseller

Huh, I thought accepting legal tender was a federal rule, I guess not. Looks like a salad variety of regulations that vary by state and city.

Note the wording on dollar bills:

> This note is legal tender for all debts, public and private.

Re: What do Visa and Mastercard do? An intro to card networks

#84

Post by jimbob45 » Wed, Sep 09, 2026, 7:50 PM UTC

ianhawes wrote: post #58

losvedir wrote: post #44

I play the credit card "game" because I hate feeling like I'm leaving money on the table, but I really wish I didn't have to. Some degrees of fees make sense, to run the network, and handle fraud, but it's ridiculous that people have this sense that shopping should somehow fund your vacation. Where I am it's increasingly common to see credit card fees when checking out. I get it, because merchants are being charged 3…

There is, it's called debit cards, but Stripe et al. "simplified" pricing by charging a percentage regardless of card type instead of the traditional interchange-plus pricing. Merchant banks "used to" make money by tacking on fixed fees, i.e. a set-up fee, terminal fee, monthly fee, etc, but then Stripe came along and provided (1) a better dev experience, (2) better onboarding, and (3) simplified pricing.

You have to wait for the investigation to complete to receive compensation if you’re hit by fraud on a debit card. Credit cards don’t share that issue. If you’re poor or living paycheck-to-paycheck, debit cards are potentially a risk to your livelihood.

Re: What do Visa and Mastercard do? An intro to card networks

#85

Post by rednb » Wed, Sep 09, 2026, 7:50 PM UTC

bob1029 wrote: post #34

VisaNet & friends make the modern consumer world go round. The fees they extract are a drop in the bucket compared to the economic activity that they enable with their networks. Many businesses simply couldn't exist without something approximating this. https://investor.visa.com/news/news-details/2016/Visa-Commis...

You are literally linking to a page published by Visa's Investors Relations Department.

The problem is that like all cartels, they hold progress back. Things could be even more efficient than the current state of affairs. For example we could have open standards with thousands of local players, much faster settlement times etc...

There are also aspects such as the fact that due to this concentration of power, the whole world is subject to US sanctions, such that a EU citizen sanctioned by the US is effectively cut off from civilization.

Re: What do Visa and Mastercard do? An intro to card networks

#86

Post by qurren » Wed, Sep 09, 2026, 7:51 PM UTC

losvedir wrote: post #44

I play the credit card "game" because I hate feeling like I'm leaving money on the table, but I really wish I didn't have to. Some degrees of fees make sense, to run the network, and handle fraud, but it's ridiculous that people have this sense that shopping should somehow fund your vacation. Where I am it's increasingly common to see credit card fees when checking out. I get it, because merchants are being charged 3…

I used to think "I should be nice to merchants" and pay everything in cash.

That was 15 years ago. Now, living costs have gone up, I'm getting taxed to death by not just governments but increasingly more by businesses themselves ("benefits fees", "installation fee", "convenience fee", guilt-tip screens, sneaky price increases, etc.) so now I feel no guilt in playing the system to get at least some of my money back. Now I just churn 1-2 credit cards a year to pay my taxes and get some of it back in the massive sign up bonuses, which more than cover the transaction costs, fees, and then get me another few thousand back.

If merchants across the world make a deal with me to charge exactly the listed/advertised number exactly, no more, no less, then I'll pay in cash again.

Deal? No? Okay, you continue paying your merchant fees and I'll continue reaping the credit card bonuses to the maximum possible.

Re: What do Visa and Mastercard do? An intro to card networks

#87

Post by milesskorpen » Wed, Sep 09, 2026, 7:54 PM UTC

ianhawes wrote: post #58

losvedir wrote: post #44

I play the credit card "game" because I hate feeling like I'm leaving money on the table, but I really wish I didn't have to. Some degrees of fees make sense, to run the network, and handle fraud, but it's ridiculous that people have this sense that shopping should somehow fund your vacation. Where I am it's increasingly common to see credit card fees when checking out. I get it, because merchants are being charged 3…

There is, it's called debit cards, but Stripe et al. "simplified" pricing by charging a percentage regardless of card type instead of the traditional interchange-plus pricing. Merchant banks "used to" make money by tacking on fixed fees, i.e. a set-up fee, terminal fee, monthly fee, etc, but then Stripe came along and provided (1) a better dev experience, (2) better onboarding, and (3) simplified pricing.

Also debit cards run by smaller credit unions charge credit-card like fees (and then are used by fintechs to earn fees while making it harder to pass those fees on to end users).

Re: What do Visa and Mastercard do? An intro to card networks

#88

Post by thomasahle » Wed, Sep 09, 2026, 7:58 PM UTC

maelito wrote: post #72

Well I don't really know what they do, but what I know is that Visa transactions costs are 0,22 € out of a payment of 1 €, Mastercard's is 0,23 €, and the French CB network is 0,17 €. All of them do the same : ensure I get the money from the customer. Of course it's a larger project to run this in the whole world, but shouldn't it scale to less along with the number of billions of customers instead of the other way r…

They charge you 23%?

I thought in the EU the maximum interchange fee for consumer credit cards is capped at 0.3% of the transaction value.

Re: What do Visa and Mastercard do? An intro to card networks

#89

Post by puzzledobserver » Wed, Sep 09, 2026, 7:59 PM UTC

toast0 wrote: post #71

asdff wrote: post #65

Earlier quoted context omitted.

Another thing to consider is your credit card rewards cash back etc are really trading your privacy for a little rounding error worth of discount in comparison to using cash. You may also save far more money going cash only. E.g. some local restaurants near me give you like 5% off paying in cash. Gas is generally cheaper cash price vs card price or debit fee. You have a big job with a contractor, tell them you might…

> Another thing to consider is your credit card rewards cash back etc are really trading your privacy for a little rounding error worth of discount in comparison to using cash. How much privacy really? If I get mostly $20s from the ATM, and the merchant does daily deposits of most of the $20s they get, why wouldn't banks start scanning and tracking serial numbers (if they don't already), if my purchasing habits are a…

In a theoretical sense, you are right.

The life of most currency notes is bank to customer to merchant to bank, and the bank could just track serial numbers to figure out your spending habits.

Practically, it would make little sense. The actual life of most currency notes is bank1 to customer to merchant to bank2, and there is a large probability that bank1 and bank2 are different entities. And then, so many more people use the credit card system, and it is so much easier to track people there, that the ROI on tracking people using cash would be low.

I would be very surprised if any bank tried to scan currency note serial numbers.

Re: What do Visa and Mastercard do? An intro to card networks

#90

Post by nemomarx » Wed, Sep 09, 2026, 8:01 PM UTC

why-el wrote: post #56

mikepurvis wrote: post #32

Earlier quoted context omitted.

I mean, cash is also expensive in its own way. It has to be handled and insured, coins may need to be rolled before being taken to the bank, a register is a mechanical device to power and maintain, petty theft by employees is a concern. It's not really that hard to see why a business charging $5-20 per transaction from people who all have phones and credit cards anyway might choose not to accept cash.

> a register is a mechanical device to power and maintain, surely a million times less expensive than a subscription to a POS....this is not a strong argument.

if you cut out all the other details they mentioned I guess. how much do you think taking the cash to the bank weekly costs?