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

#271

Post by DANmode » Thu, Sep 10, 2026, 6:26 AM 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.

Fun fact: Visa owns some of Stripe.

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

#272

Post by missedthecue » Thu, Sep 10, 2026, 6:31 AM UTC

mococa wrote: post #119

In brazil we have pix with 0 fees.

Between individuals it is free. For commercial transactions, there is a fee between 0.22% and 0.33% per transaction, which is actually ~2x the fee of the Visa network (0.13%)! Visa is extremely efficient at moving money anywhere in the world.

Credit and debit card transactions have higher fees because unlike Pix, there is chargeback risk, and the the merchant and acquiring banks party to the transaction are compensated for the risk they assume in those transactions. Pix on the other hand is digital cash. When you spend it, it's gone. Unlike with chargebacks and disputes, there is no reliable mechanism to recover funds for goods not delivered.

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

#273

Post by brnt » Thu, Sep 10, 2026, 6:36 AM UTC

franga2000 wrote: post #266

klrefg wrote: post #263

Earlier quoted context omitted.

How do any of they rent cars when they travel? I think that still requires a credit pretty much anywhere in Europe. I’s bet the proportion is way higher than 5% even if the overwhelming majority use their credit cards the same was as debit.

The only time I "needed" a credit card is when I tried to sign up for some US company's service. It rejected my debit card because it wanted credit, so I just took my business elsewhere. Other than that, I've rented cars, rented other things with a "X will be charged to your card if you return it late", unattended gas stations... all the usual places you'd think need a credit card. It's fine. We do have a "negative l…

I had a car rental in Oslo that only allowed debit cards if you took out their full insurance. I was already insured, we rented though some sort of front, but they only allowed that on a credit credit card.

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

#274

Post by adrian_b » Thu, Sep 10, 2026, 6:39 AM UTC

canjobear wrote: post #233

adrian_b wrote: post #199

Earlier quoted context omitted.

I think that there was a recent HN thread that linked to an article which argued that the credit card system of USA has the purpose of taking money from the poor and giving them to the rich, and the estimated amount of the money transferred in this way was huge. The EU limits for card fees prevent this in Europe, which is very good.

A refutation of that view: https://www.complexsystemspodcast.com/episodes/credit-card-r...

Looking now at that, it does a poor job of making a true refutation.

What that article explains, is that the system of credit card fees and rewards that is used in USA is extraordinarily complicated, variable and obfuscated in comparison with other countries, so it is extremely difficult to discover who gains most and who loses most.

So the conclusion is more like "there is insufficient evidence because we cannot access all the required financial information" for the claims of the other article and the refutation itself presents no evidence that the claims of wealth redistribution are incorrect.