steal money FTFY
Cost of handling cash is higher than you might expect, which means that interchange fees aren't nearly as bad a deal for the merchants as people think.
How credit cards make money
171–180 of 445 posts
Re: How credit cards make money
#172Earlier quoted context omitted.
I got burned by Aliexpress and now I highly recommend people use credit cards for all purchases. I had a debit card saved on Aliexpress. The account was compromised by unknown means (maybe public wifi). Someone bought several $1,000+ phones from China that shipped to me in the US. I presume the sellers were in on it and were selling me unwanted inventory at inflated prices. Because they had tracking information, my b…
Funny how the banks are able to roll back at will when they are defrauded but when it is their customers they pretend that they can't do anything. I've seen transactions six months old rolled back because it benefited the bank.
Which is why I cringed at patio11's twitter thread where he insisted that the banking system is one giant kumbaya circle that works together to Do The Right THing
Re: How credit cards make money
#173Earlier quoted context omitted.
Just a data point about your last paragraph, depositing cash to make payments. My chase atm card does not allow to deposit cash directly to any chase or non chase credit card. I have to put it in chase checking, and then I can use it for payments. Also, capital one, synchrony, amex does not allow me to pay more than 10% of my outstanding balance on their credit cards.
> Also, capital one, synchrony, amex does not allow me to pay more than 10% of my outstanding balance on their credit cards. Do you mean “in cash” or, like, as any single transaction?
No, i mean if my outstanding credit card balance is $100 (statement or not, but outside of pending, means cleared), then Amex or Capital One apps does not allow payments bigger than $110 (minus any pending payments).
Re: How credit cards make money
#174Earlier quoted context omitted.
> You are no longer obsessing over "early payday" features or ACH speeds. Timing ACH payments _sucks_. Tangential, but I'm in a renting situation where my landlord demands rent land in their account on the first of the month. Receiving rent on the 26th (i.e. 5 days early, not 26 days late) was deemed "too confusing" for them. I now have to play this awful game of timing ACH transfers to land on their account as close…
I'm in a renting situation where my landlord demands rent land in their account on the first of the month. Receiving rent on the 26th (i.e. 5 days early, not 26 days late) was deemed "too confusing" for them. I ran into this at my last place. I'm the sort of person who likes to pay things ahead so I don't have to think or worry about them. I was used to paying my rent ahead and quarterly. When I moved to the new plac…
Ha! My current apartment wants me to pay $19.95 to do a one-time eCheck (direct debit, it's basically free on their end) but allows me to drop checks in the office for free. What a backwards system.
Re: How credit cards make money
#175> Debit cards are a very similar product with enough under-the-hood differences that they deserve their own moment in the sun. In particular, due to a quirk of U.S. interchange regulation, they basically fund most of the fintech industry Basically, the Durbin Amendment caps interchange on debit cards at a far, far lower rate than credit cards; they also have different networks (not MC or Visa) that can be run at leas…
You missed the biggest advantage of credit cards - the limited liability of the card holder to fraudulent charges! From a financial website… “ CREDIT CARDS Credit cards offer consumers the widest fraud protection. By Federal law, a cardholder is only liable for the first $50 of an unauthorized transaction at most, with many issuers offering cards with zero liability. DEBIT CARDS Debit card holders are protected under…
> Credit cards offer consumers the widest fraud protection
That's for consumers, but what protection do I get on my company credit card?
Re: How credit cards make money
#176The knowledge which the author has been sharing has been my interest for a long time. I gave up because lack of material on it. Any idea how did OP gain all these knowledge? For example, I want to implement a QR payment application, think like transferring money through Venmo using QR code, now Paypal does it, very popular in China -- basically a payment processing application but my local country - think Mexico or P…
I think they were trying to get payments going for a startup idea and were trying to get payments integrated. Or at least that's the founding story.
"In early 2010 John and Patrick began working on Stripe together. At the time Patrick was working on several side projects and they debated why it was so difficult to accept payments on the web. They sought to solve the problem and see if it was possible to make it simple - really simple. The next 6-months they played with it, showed it to friends, and saw how people interacted with it, iterating along the way."
[1] https://www.startupgrind.com/blog/the-collison-brothers-and-...
Re: How credit cards make money
#177Earlier quoted context omitted.
> It is possible, given the design of individual products, that a user with close-to-optimal spending decisions is contribution margin negative on individual products and potentially on all accounts I feel like that user is typically the sort who enjoys telling anyone who will listen about how they managed to get great rewards from their card. With all that free marketing, the credit card issuer is probably happy to…
FWIW: I think technologists are far too quick to jump to "I bet they want to do it for free marketing" and far too slow to think "I bet they have a large team of people who does almost literally nothing other than study this exact question, has thought about it for hundreds of thousands more hours than any credit card user has, and has a highly developed technical infrastructure capable of authoritatively answering i…
> It is a curious, curious belief in the engineering community that we are better at trivial math than banks are. That is not a bet I would encourage people to make.
Although sometimes people are right on that bet, disrupts an entire industry and becomes billionaires. Entire industries can turn a blind eye to problems that are obvious to some, and later it turns out the industry experts were wrong.
So I wont stop making simple back of the envelope calculations and discuss and judge industries based on that. In most cases you are wrong when you do it (which you'll realize when you dig down a bit further), but sometimes the industry is wrong and you really don't want to miss those cases.
Re: How credit cards make money
#178Earlier quoted context omitted.
Funny how the banks are able to roll back at will when they are defrauded but when it is their customers they pretend that they can't do anything. I've seen transactions six months old rolled back because it benefited the bank.
Which is why I cringed at patio11's twitter thread where he insisted that the banking system is one giant kumbaya circle that works together to Do The Right THing https://twitter.com/patio11/status/1443745867572277250
I've worked for a bank, let's just say that I can't agree with that. A US bank at that.
I just noticed:
Re: How credit cards make money
#179The knowledge which the author has been sharing has been my interest for a long time. I gave up because lack of material on it. Any idea how did OP gain all these knowledge? For example, I want to implement a QR payment application, think like transferring money through Venmo using QR code, now Paypal does it, very popular in China -- basically a payment processing application but my local country - think Mexico or P…
Apart from talking to people, I think he read a lot of bank annual reports and spent time on forums dedicated to helping people get redress from banks.
Re: How credit cards make money
#180Earlier quoted context omitted.
Unfortunately you often don't find out about this policy until you've signed the lease and set up your payment account.
Any such policy would need to be specified within the lease to be enforceable. If there is nothing in your lease that mandates a bespoke payment method, call their bluff and just pay by check. There are real issues with incomprehensible leases and terms of adhesion sprung late in the process, but it behooves us to keep focus on the specific contours of the problem so the people who are able to push back on such nonse…
The primary reasons people choose a residence are price and location. Method of payment is probably not even in the top hundred reasons on the list.