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Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

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Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#141

Post by adventured »

kasey_junk wrote: post #86
sorenbs wrote: post #18

In Denmark we have a national payment system called Dankort. All issued Visa cards also work as Dankort. Transaction fees on Dankort is one tenth of visa, and all payment terminals default to Dankort. This saves Danish retail a lot of money while still ensuring they we can buy stuff online and when traveling using visa.

To be clear that’s due to laws in Denmark that require its acceptance and granting it a particular monopoly status? I’d be curious what the issue rate between the Dankort & the Kroger Plus Card. It’s conceivable that Kroger has the market heft to do with selling power what Denmark did with law. As context Kroger employees about the same number of people as 1/10th of Denmark though I have no idea how that translates t…

You can't safely inconvenience all your customers even if you're at Kroger's scale. Walmart is extremely eager to kill you if you're Kroger, to gain market share in groceries. It leaves no safe opening to upset a large share of your customers: many will go across the street to Walmart.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#142

Post by smileysteve »

entee wrote: post #5
devoply wrote: post #4

> over the $90 billion they pay in swipe fees every year. > Kroger's revenue was 122.7 billion USD in 2017 That makes little sense and makes me wonder why Kroger does not issue its own credit card. Credit cards are a rent-seeking racket that eat lots of profit. Everyone knows it but no one knows what to do about it.

I wonder if Apple and others that can generate "soft" credit cards could make this (essentially 1 card per merchant) work pretty easily and seamlessly for consumers. I don't know what underlying infrastructure they have though, are they still heavily dependent on Visa/Mastercard/Amex networks under the hood to do the dirty work or do they have a parallel system?

Your summoning of Apple is funny because one reason many merchants disabled NFC is because Apple tacked on an additional fee for those purchases.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#143

Post by 001spartan »

koolba wrote: post #72
smsm42 wrote: post #68

Earlier quoted context omitted.

If you have regular rewards card, like 1%-1.5%, sure. But if you have 3% or 5% (I don't know of any card that does it on taxes specifically, but there might be ones where it fits some of the categories) or if you need to fulfill requirement like "spend $X000 in N months and get tons of points" then even with the transaction fee it might actually be a pretty good deal.

I’ve never seen a 5% rewards card for generic purchases. Does that exist?

The Amazon Prime Visa gives 5% back on Amazon purchases.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#144

Post by avip »

seszett wrote: post #140
sorenbs wrote: post #18

In Denmark we have a national payment system called Dankort. All issued Visa cards also work as Dankort. Transaction fees on Dankort is one tenth of visa, and all payment terminals default to Dankort. This saves Danish retail a lot of money while still ensuring they we can buy stuff online and when traveling using visa.

I think most countries have that. CB in France, Interac in Canada, Bancontact in Belgium, etc. But that concept sounds like it wouldn't fare well in the US.

Interac is for debit transactions only.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#145

Post by Nursie »

jamie_ca wrote: post #122
ashishb wrote: post #109

https://www.bostonfed.org/publications/public-policy-discuss... " On average, each cash-using household pays $149 to card-using households and each card-using household receives $1,133 from cash users every year. Because credit card spending and rewards are positively correlated with household income, the payment instrument transfer also induces a regressive transfer from low-income to high-income households in gener…

I believe it. My MasterCard is 2% cashback (through points, but that just means I batch it), but has an annual fee of $150 for two cards, and a minimum household income. I need to spend $7500 on the card just to break even, but if I funnel nearly all my expenses through the card I can net $1000 or more a year. These "rewards" come from the merchant, in the form of higher fees, and because the merchant can't discrimin…

This sounds very weird to this european.... but that's probably because fees here are capped at 0.3% and AFAICT there's not really such thing as a cashback card.

(I think they used to exist, just not any more)

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#146

Post by MrEldritch »

pseingatl wrote: post #137
MrEldritch wrote: post #127

Earlier quoted context omitted.

I seem to recall from a previous discussion about the possibility of Amazon buying a bank that such an arrangement would be extremely illegal. IIRC, there's a law expressly prohibiting any company from both acting as a bank and a retail business. edit: Yep, there is. The Bank Holding Company Act prevents companies in commerce from engaging in banking activities.

Laws can be changed. An entity like Amazon can lobby for a change. Donate money to politicians likely to vote for a change. Call for a change on the editorial page of the Washington Post. Remember, once upon a time, there was but one phone company. Then the law changed... Interstate/branch banking was illegal. Then the law changed. Amazon could probably set up a members-(i.e., customers) only credit union without too…

>Despite the pain, I still think Walmart should’ve acquired and rebranded a bank, and offered financial products.

I just wanted to point out that this was actually significantly more difficult than the parent comment may have realized.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#147

Post by Nursie »

sorenbs wrote: post #18

In Denmark we have a national payment system called Dankort. All issued Visa cards also work as Dankort. Transaction fees on Dankort is one tenth of visa, and all payment terminals default to Dankort. This saves Danish retail a lot of money while still ensuring they we can buy stuff online and when traveling using visa.

In the EU transaction fees are capped at 0.3% anyway, by law.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#148

Post by SlowRobotAhead »

jimmy1 wrote: post #117
cycrutchfield wrote: post #85

Earlier quoted context omitted.

Most people that care get a substantial portion of those fees back (either as cash or rewards). So in reality, those fees are a tax on the poor, the un-creditworthy, and the financially illiterate.

Most places that the poor (at least in rural areas) shop at offer substantial discounts for paying with cash. There is typically the "cash" price and the "card" price. At a liquor store, a 44 dollar bottle paid with card is 39 dollars cash. A haircut at the local barber is 13 dollars cash or 15 dollars card.

>At a liquor store, a 44 dollar bottle paid with card is 39 dollars cash

The credit card fee is not 12.8% to 15%, that isn’t even a convinence fee. That’s your liquor store not reporting sales and not paying taxes. That’s a big reason why some businesses won’t take cards.

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#149

Post by SyneRyder »

viraptor wrote: post #95
cycrutchfield wrote: post #85

Earlier quoted context omitted.

Most people that care get a substantial portion of those fees back (either as cash or rewards). So in reality, those fees are a tax on the poor, the un-creditworthy, and the financially illiterate.

Do you really? Maybe it's country-specific, but in Australia there are no programs which give you that many benefits. Likely the best are the airline points, and even then they don't cover close to the payment processing fee total.

There's been a recent change in Australia, the Reserve Bank put a cap on the maximum interchange fee credit card companies can charge in Australia (capped at 0.8%). As a result, many of the cards that earned the best rewards have been scrapped. I had an AmEx card that was good for earning airline points, the bank cancelled the card after the Reserve Bank ruling.

https://www.smh.com.au/business/banking-and-finance/rba-chan...

Re: Credit-Card Backlash Mounts as Kroger Weighs Expanding Visa Ban

#150

Post by Nursie »

westoque wrote: post #24

These kinds of problems (swipe fees, etc) is where I believe cryptocurrencies shine. Having a fee payment which is reasonable and fast confirmation times would solve this problem immediately removing the need for third parties.

This is where government regulation shines - 0.3% max fee in the EU
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