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Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

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Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#321

Post by Nextgrid »

anonzzzies wrote: post #265
jkaplowitz wrote: post #252

Earlier quoted context omitted.

How do you handle the part of chargebacks that currently validly apply to authorized non-fraudulent transactions, like services/product not delivered or not as described, or accidental double charges from vendors like random taxi drivers with whom you don't have a way to arrange a refund?

mediation/arbitration It already works like that here (eu) for debit cards (which most people have; very few have credit cards although they don't know the difference). Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot); products not as delivered is responsibi…

Keep in mind that card disputes are a thing even for debit cards. Credit cards may have higher protections by law that force the lender to eat the disputed amount regardless of the dispute's outcome, but the actual process of disputing a transaction is applicable to all cards - I've successfully done chargebacks on debit cards here in the UK.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#322

Post by Nextgrid »

sidewndr46 wrote: post #314
Nextgrid wrote: post #120

Earlier quoted context omitted.

A lot of the fraud hinges on the fact that all you need to drain an account is a static card number. A lot of hacks are subsequently piled on top of that to try and make it harder (SCA/3D Secure, captchas, etc), and a lot of busywork is spent tidying up the consequences of that (chargeback handling, etc). You could eliminate a lot of the fraud by moving off a mostly-static identifier to merchant, amount and time-limi…

From a merchant perspective, there is a significant group that view this as a feature. Not a bug. Once a merchant gathers you credit card info, they can submit basically any transaction they want at any time. Yes, if you do this enough your payment processor will cut you off. But for businesses like gym membership, NYTimes subscription, car rentals, etc. it's a core feature. The product in that case is not "payments…

> they can submit basically any transaction they want at any time

This can be generally be accommodated in my suggested model, they just have to specify upfront how much & how often they'd want to charge. If the gym membership is 50 bucks a month, then the token has a monthly limit of 50 (or maybe a bit more, to account for potential extras). The token lifetime could be set for the membership duration.

> car rentals

Get 1 token with your rental fee + a separate token (scoped until car return date + some time to inspect/discover any damage) for the deposit amount?

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#323

Post by kweingar »

rightbyte wrote: post #280
peteforde wrote: post #237

Earlier quoted context omitted.

The alarming rise in the incident rate of inappropriate chargebacks ("my fries were cold") really pisses me off as a sane user of contemporary credit card infrastructure. That is, I think of chargebacks as an absolute last resort; essentially a bulwark/ombudsman to protect me from bad actors. It should be used incredibly conservatively, and it should have significant reprocussions if it is used inappropriately; sort…

> peace of mind Pay with cash. No risk of recurring charges, charging more than what you hand over, etc.

This doesn't seem relevant to a discussion about chargebacks, a feature that cash famously does not have.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#324

Post by jahabrewer »

Loughla wrote: post #241
jahabrewer wrote: post #210

Earlier quoted context omitted.

> You can’t make a living posting stuff online on your own private website. There are many counterexamples to this.

I'm not trying to be stupid but can you name some?

Ben Thompson and the Air Current guy are two that come to mind

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#326

Post by d0gsg0w00f »

ta_1138 wrote: post #125
thesausageking wrote: post #39

Earlier quoted context omitted.

The challenger to these will solve for a different problem. Not every transaction needs complex fraud detection or being able for the customer do to chargebacks. For a 3% discount, would customers agree to use something that worked just like cash, where the transfer was instant and couldn't be undone? Then you don't have to worry about fraud, chargebacks, etc.

You are missing the opposite side of the fraud picture: Where it's not the business scamming you, but someone taking your credentials and spending up to the limit in a store that deals with no chargebacks. This is, if anything, the larger size of the fraud losses for the Stripes of the world. Fake businesses that use the cards either for testing if the creds are good, or where the owners charge cards that they obtain…

But fraudsters can steal your cash too. The difference is that you don't call the bank when someone takes your cash, you call the cops.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#327

Post by daveoc64 »

anonzzzies wrote: post #311
jkaplowitz wrote: post #310

Earlier quoted context omitted.

> Double charges from taxi drivers is not possible as it's tapping or dipping your card and you are there for that (we are assuming some system that prevents someone stealing your card like biometrics or whatnot) You'd be surprised - at least in the public transit context with iOS Express Mode, double Apple Pay taps by transit systems have absolutely been recorded plenty of times. I admit I haven't heard about this i…

> To be honest, no, the idea that chargebacks are common in the US is a stereotype and not true. The thing is, even here on HN (where I expect, maybe not warranted, the level to be higher), people seem to absolutely proud and entitled to chargeback whatever for whatever reason. Those are almost 100% Americans (I check) and that is where I got the idea; this sentiment is much higher on tiktok, youtube, reddit etc. I e…

>The thing is, even here on HN (where I expect, maybe not warranted, the level to be higher), people seem to absolutely proud and entitled to chargeback whatever for whatever reason.

I'm not American (I'm from the UK), but filing a chargeback is an incredibly satisfying weapon for a consumer.

So many companies try to weasel out of their legal obligations under consumer protection law, so why not hit them with a chargeback when they won't do what they're required to?

After being burned by PayPal protection not working out, I will now buy anything I can directly on a Credit Card, as you just get so much more protection in the UK - both contractually and legally.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#328

Post by hakfoo »

peteforde wrote: post #237
martinald wrote: post #186

Earlier quoted context omitted.

In a word yes. You'll still get a lot of chargebacks by the way. With a lot of ecomm I've been involved with the fraud you are talking about is actually a small part of chargeback volume. Most is unhappy or demanding customers, or another type of low level fraud, claiming goods didn't arrive despite a photo of the person literally accepting them from the delivery company. This is absolutely rampant in b2c with smalle…

The alarming rise in the incident rate of inappropriate chargebacks ("my fries were cold") really pisses me off as a sane user of contemporary credit card infrastructure. That is, I think of chargebacks as an absolute last resort; essentially a bulwark/ombudsman to protect me from bad actors. It should be used incredibly conservatively, and it should have significant reprocussions if it is used inappropriately; sort…

Chargebacks are in many cases the outsourcing of proper consumer-protection regulation and everyday customer service.

When the merchant fails to deliver or underdelivers -- "my fries were cold" -- appropriate customer service should be meeting the customer at that point and addressing it directly.

Modern systems of unempowered on-the-ground employees and endless loop self-service support stand in the way of that. Consumers naturally respond by pulling the levers that remain, which is invoking the wrath of American Express.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#329

Post by __MatrixMan__ »

dzikimarian wrote: post #309
__MatrixMan__ wrote: post #180

Earlier quoted context omitted.

Doesn't that just trade one symmetric secret for another? (your password) I suppose it's a little better because you probably haven't written your password on the side of your card, but everytime I have to go through it it feels like I'm getting phished. Also, SSL seems kind of messy for the job. You've already got the processor as a third party, now the CA's are a fourth party, plus whoever gets to install certs on…

3ds is usually done with inapp confirmation these days. Your bank is responsible for the experience.

If my bank were responsible, they wouldn't be using SMS 2FA.

Re: Ask HN: Do we need to pay billions in fees to Stripe, Block, PayPal and Visa/MC?

#330

Post by sidewndr46 »

Nextgrid wrote: post #322
sidewndr46 wrote: post #314

Earlier quoted context omitted.

From a merchant perspective, there is a significant group that view this as a feature. Not a bug. Once a merchant gathers you credit card info, they can submit basically any transaction they want at any time. Yes, if you do this enough your payment processor will cut you off. But for businesses like gym membership, NYTimes subscription, car rentals, etc. it's a core feature. The product in that case is not "payments…

> they can submit basically any transaction they want at any time This can be generally be accommodated in my suggested model, they just have to specify upfront how much & how often they'd want to charge. If the gym membership is 50 bucks a month, then the token has a monthly limit of 50 (or maybe a bit more, to account for potential extras). The token lifetime could be set for the membership duration. > car rentals…

You're thinking technical solutions to a sociological problem. Businesses like this are built on the fact that they can charge you an unspecified amount for an indefinite amount of time. Any attempt at a technical solution means those businesses refuse to adopt that solution.
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