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

tautology.town

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

#151

Post by LeBit »

losvedir wrote: post #139
ianhawes wrote: post #58

Earlier quoted context omitted.

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.

Debit cards aren't that, in practice, because as you say they typically get the same 3% fee whenever I've asked. Toast and other point of sale networks just charge it based on the network and not the card type. But even so, I still prefer the credit card instrument, used as a "charge card". For those that don't know, a "charge card" is common with businesses and is expected to be paid off every month. But it helps wi…

As a Canadian , I thought that was the expected de facto way of using credit cards: you pay everything with it so you get rewards (ie money) at the end of the year as a function of how much you used the card during the year. At the end of the month, you pay whatever the outstanding balance is, otherwise you pay high interests.

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

#152

Post by topranks »

simonmales wrote: post #134
gwbas1c wrote: post #129

Earlier quoted context omitted.

The problem is that bitcoin (and similar) are so computationally intense to run, that the transaction cost is much higher than Visa's. Furthermore, a currency needs a government (or similar kind of body) to manage its stability, by printing (and buying) money. Otherwise, we'll see wide fluctuations in value like what happens with Bitcoin.

True on the main chain of Bitcoin. Bitcoin payments on the lightning network are not computationally intense.

Hahaha haven’t heard that one in a long time. Cracked me up.

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

#153

Post by warkdarrior »

carlosjobim wrote: post #101
nemomarx wrote: post #90

Earlier quoted context omitted.

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?

Nothing, because the owner is rejoicing every step of the way. I'd say employee theft is the only reason a coffee shop would be "no-cash", and fear of robbery in a few places.

You think the owner is taking the cash to the bank?? Unless they are an one-person operation, they likely have an employee do it (among their other duties).

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

#154

Post by bix6 »

puzzledobserver wrote: post #89
toast0 wrote: post #71

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. 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 peo…

Is the probability that large for bank1 vs bank2? There’s only a few major banks left. Chase has so many ATMs it’s hard to compete with the access.

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

#155

Post by eastbayjake »

losvedir wrote: post #139
ianhawes wrote: post #58

Earlier quoted context omitted.

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.

Debit cards aren't that, in practice, because as you say they typically get the same 3% fee whenever I've asked. Toast and other point of sale networks just charge it based on the network and not the card type. But even so, I still prefer the credit card instrument, used as a "charge card". For those that don't know, a "charge card" is common with businesses and is expected to be paid off every month. But it helps wi…

Debit cards are not subject to surcharging, and any merchant doing so is violating Visa/Mastercard regulations. (And possibly state law in several places -- Colorado where I live caps surcharge at the lesser of 2% or the cost of payment processing.)

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

#156

Post by asdff »

supertrope wrote: post #127
asdff wrote: post #66

Earlier quoted context omitted.

If your employees are stealing you should probably nip that in the bud...

Cash allows for many more opportunities for diversion.

You know they count the till against the reciepts right? And frequently have cameras over the register drawer pointed at the employee? And send people to jail who try to do this?

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

#157

Post by [deleted] »

kazinator wrote: post #98
qurren wrote: post #86

Earlier quoted context omitted.

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. N…

> 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. Where are you not getting this? You mean taxes on top of the retail price? You would pay cash, if the merchants colluded with you in evading taxes?

[deleted]

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

#158

Post by dmoy »

nonethewiser wrote: post #45
aand16 wrote: post #36

Earlier quoted context omitted.

90% of cash I give to restaurants goes in the pocket, not the register. Bad service = card always.

Are you saying servers keep 90% of what you pay? Tip and otherwise? What country? How do you know? How could a business possibly operate in this reality?

Not necessarily servers, just not into the register as a tracked transaction.

Tax fraud, essentially.

E.g. you go to the Minnesota State Fair, merchants may offer to not charge sales tax if you pay cash. It is shockingly brazen sometimes.

> How could a business possibly operate in this reality?

Extremely lax enforcement on the part of the specific US state's department of revenue

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

#159

Post by klabb3 »

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...

> VisaNet & friends make the modern consumer world go round.

I mean, as opposed to what? You could apply this to any infrastructure cartel like with AT&T in the 90s or Comcast or 100s of historical examples. The alternative to a bridge troll is not ”no bridge”.

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

#160

Post by warkdarrior »

carlosjobim wrote: post #126
mopsi wrote: post #63

Earlier quoted context omitted.

You resolve it the same way you handle in-store cash purchases of products that turn out to be faulty. There is no reason why fraud and contract violation must be handled by unelected and unaccountable payment processor, when the government has already set up a consumer protection system for disputes related to cash payments. The payment processor is best left as a dumb pipe that does what parties and (in case of dis…

You have to consider the interest of the involved parties rather than the efficiency of a system. Making a purchase is (still) voluntary for the customer. For everyday purchases at physical stores, cards are convenient. You just swipe and maybe put your PIN. But other digital payment methods or cash can be just as convenient. You're never going to chargeback a coffee, a sandwich, or your groceries. But for distance p…

> Cards have fraud protection.

This is only in US and it is needed in US, because US has very limited consumer rights regulation. EU has much stronger consumer rights (mandatory 14-day return windows for any reason, easy cancellation for subscriptions, mandatory 2-year warranties).

So the things that the (private) credit-card companies protect you from in US (via chargeback support and fraud detection) are things that laws protect you from in EU.

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