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Stripe increases price for business in the European Economic Area

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Re: Stripe increases price for business in the European Economic Area

#111

Post by kmlx »

avianlyric wrote: post #78
bjackman wrote: post #10

I have been pondering transaction costs lately. Seems like this is an area where intervention could have massive impact: these costs are effectively a tax that incurs deadweight loss so according to prevailing economic theory if we can reduce it the whole economy should be catalysed. IIUC governments already introduce price caps for certain elements of this market but I think we could be doing more? Like mandating in…

The EU introduced price caps on interchange in 2015 capping interchange on credit cards at 0.3% and debit cards at 0.2%. That’s almost an order-of-magnitude lower than interchange fees in the US, which are usually around the 1%-2% level. This is big part of the reason you don’t see high value reward cards or cashback program in the EU. There simply isn’t the interchange revenue to fund them, which is good thing, beca…

> you don’t see high value reward cards or cashback program in the EU.

this seems like a false statement.

here is an article from 2021 that highlights some of the numerous cashback offers:

https://medium.com/@danminea/best-cashback-cards-with-reward...

and Amex usually has cashback cards as well.

disclaimer: i have used some of these cashback cards both in the EU and outside of it.

Re: Stripe increases price for business in the European Economic Area

#112

Post by hocuspocus »

throwaway67743 wrote: post #108
hocuspocus wrote: post #103

Earlier quoted context omitted.

How does lowering fees increase the cost of doing business exactly? The only businesses suffering from the cap are issuing banks.

Fees are not the only cost of business, compliance is too - and things like if you want to enjoy lower intra-EU costs then you need to be in the EU which is an added cost as a non-EU business, etc - it's not as simple as "fees more eu bad"

That's true pretty much everywhere on Earth.

Some countries smaller than the EU bloc have more complex regulations regarding online payments.

The EU managed to cut fees in half for its population and businesses, if you want to stay outside then why do you care?

Re: Stripe increases price for business in the European Economic Area

#113

Post by switch007 »

brmgb wrote: post #74
switch007 wrote: post #36

Earlier quoted context omitted.

Everyone is increasing prices in Europe. Inflation in the UK is crazy. I'm standing in my local coffee place and a basic Americano went up £0.50 overnight It's crazy and a lot of gouging is happening (not so much these smaller companies. They do have it tough. The owner does drive an expensive BMW though)

> Everyone is increasing prices in Europe. Inflation in the UK is crazy. Yes but payment processors generally take fees as a share of transactions. That naturally shields them for inflation. Raising their percentage fees is just a naked cash grab.

I wasn't attempting to justify it. The opposite.

Re: Stripe increases price for business in the European Economic Area

#114

Post by dagw »

adrr wrote: post #107
avianlyric wrote: post #78

Earlier quoted context omitted.

The EU introduced price caps on interchange in 2015 capping interchange on credit cards at 0.3% and debit cards at 0.2%. That’s almost an order-of-magnitude lower than interchange fees in the US, which are usually around the 1%-2% level. This is big part of the reason you don’t see high value reward cards or cashback program in the EU. There simply isn’t the interchange revenue to fund them, which is good thing, beca…

How do credit cards provide 60 day interest free loan with only 0.3% charge to the merchants? I can see low interchange rates for debit cards like the US the interchange for debit card for major banks is capped at 0.05%.

There is often a small annual fee connected with having a credit card (I think I pay on the order of $25 a year). Also effective interest rates are in the 15-25% range for most cards if you don't pay it off in full, which I'm sure quickly adds up.

Re: Stripe increases price for business in the European Economic Area

#115

Post by mensetmanusman »

avianlyric wrote: post #78
bjackman wrote: post #10

I have been pondering transaction costs lately. Seems like this is an area where intervention could have massive impact: these costs are effectively a tax that incurs deadweight loss so according to prevailing economic theory if we can reduce it the whole economy should be catalysed. IIUC governments already introduce price caps for certain elements of this market but I think we could be doing more? Like mandating in…

The EU introduced price caps on interchange in 2015 capping interchange on credit cards at 0.3% and debit cards at 0.2%. That’s almost an order-of-magnitude lower than interchange fees in the US, which are usually around the 1%-2% level. This is big part of the reason you don’t see high value reward cards or cashback program in the EU. There simply isn’t the interchange revenue to fund them, which is good thing, beca…

I feel bad about our high CC rewards in the US for exactly this reason. Usury was a sin in all religions for millennia, but not in the US.

Re: Stripe increases price for business in the European Economic Area

#116

Post by dagw »

khuey wrote: post #110
avianlyric wrote: post #78

Earlier quoted context omitted.

The EU introduced price caps on interchange in 2015 capping interchange on credit cards at 0.3% and debit cards at 0.2%. That’s almost an order-of-magnitude lower than interchange fees in the US, which are usually around the 1%-2% level. This is big part of the reason you don’t see high value reward cards or cashback program in the EU. There simply isn’t the interchange revenue to fund them, which is good thing, beca…

Debit card fees in the US have been capped at $0.22 + 0.05% for more than a decade.

Which is still over 1% for purchase under $20

Re: Stripe increases price for business in the European Economic Area

#117

Post by rr888 »

Its crazy there isn't more competition. I was hoping that would be one thing cryptos would be good for.

One thing I think regulators could do is force cc fees to be added to the price instead of hidden. Eg a $10 item costs $10, $10.20, $10.40 depending on which payment method you use.

Re: Stripe increases price for business in the European Economic Area

#118

Post by mardifoufs »

dagw wrote: post #116
khuey wrote: post #110

Earlier quoted context omitted.

Debit card fees in the US have been capped at $0.22 + 0.05% for more than a decade.

Which is still over 1% for purchase under $20

But still less than the EU's 0.2% cap for any serious purchase. (Over ~120$, so I'm sure it evens out)

Re: Stripe increases price for business in the European Economic Area

#119

Post by throwaway67743 »

hocuspocus wrote: post #112
throwaway67743 wrote: post #108

Earlier quoted context omitted.

Fees are not the only cost of business, compliance is too - and things like if you want to enjoy lower intra-EU costs then you need to be in the EU which is an added cost as a non-EU business, etc - it's not as simple as "fees more eu bad"

That's true pretty much everywhere on Earth. Some countries smaller than the EU bloc have more complex regulations regarding online payments. The EU managed to cut fees in half for its population and businesses, if you want to stay outside then why do you care?

You're kind of agreeing at this point, despite what the EU believe they are not self sufficient and require international business - the only people who lose out by that not happening are citizens and there are already enough reasons doing business (or even buying) stuff from outside the EU is a tedious and expensive chore

Re: Stripe increases price for business in the European Economic Area

#120

Post by dgb23 »

Semaphor wrote: post #86
dgb23 wrote: post #53

Earlier quoted context omitted.

Cookie notices are required if you for example use them to pass data to third parties. A login cookie that is just for auth is not that. It is specifically requested by the user and implies that the user's data is managed on that site and can be evicted. Same with analytics. The problem is not that you're doing analytics. It's that the user doesn't know that your doing it and that you're passing on that data to a thi…

It’s not just about third parties. I still need to consent to any PII you gather for your analytics, even if it’s completely first-party.

Would have assumed that anonymous logging is fine? Generating usage data? Error logs? As long as it’s not sold, private data or used to identify the user?

Highly doubt that kind of gathering is a problem. If it were you could close 95% of the web.

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