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How credit cards make money

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Re: How credit cards make money

#351

Post by Thorrez »

SilasX wrote: post #307
kasey_junk wrote: post #249

Earlier quoted context omitted.

I’ve worked for several us financial institutions, including banks and that exchange seems extremely typical to me. Especially the “hold harmless” bits. Which particular part of that story telling rang false to you?

The part where the banking system is a giant kumbaya circle run on gentlemen’s agreements to do the right thing. When you are clearly defrauded or scammed, banks do nothing about it. His entire thread advertises, “I’ve never wired money to a scammer”.

The thread seems to be saying banks get along with each other. It doesn't seem to me to be saying banks get along with their customers.

Re: How credit cards make money

#352

Post by shapefrog »

TulliusCicero wrote: post #338
rsj_hn wrote: post #326

Earlier quoted context omitted.

That's the purpose of the Senate. The Senate is there to represent states, not people. The House is there to represent people. Both need to agree in order to get something done. This ensures that something that is passed is approved by a majority of people and a majority of states. Otherwise, without this proposition, the states might not have ratified the constitution - the states predate the nation, and the nation…

You can have federalism without anti-democratic institutions like the Senate. If the Senate was abolished or starting apportioning senators by population, the US would remain federalist, because there'd still be plenty of powers devolved to the states. That's what makes it federalist.

> anti-democratic institutions like the Senate

Representitive democracy is anti-democratic, not allowing babies to vote is anti-deomcratic. Based on the role purpose of the Senate, its more democratic that those examples.

Its purpose is 2 votes per state, with representitives elected by the people of those states.

You may not like that that is its role, and that is fine, but you can not say it would be more democratic if some states had more votes in the same way it would not be more democratic for some people to have more votes.

Re: How credit cards make money

#353

Post by Thorrez »

lotsofpulp wrote: post #83
stefan_ wrote: post #53

Earlier quoted context omitted.

The intersection between the people that have random overdrafts and those that just pay off their credit card debt in full every time is the empty set. Why make up excuses for a few rent seekers that tax the entire economy?

Merchants WANT people to use credit cards. There is nothing stopping merchants from offering a cash/debit price and a credit price since 10 years ago. The frank dodd legislation made illegal for card networks to ban offering discounts for debit card payments, and in Mar 2017, the Supreme Court said merchants cannot be barred from advertising higher prices for credit cards. https://www.ftc.gov/tips-advice/business-cen…

I'm confused. Your comment seems to directly contradict the top comment in this thread. You say the Supreme Court ruled merchants cannot be barred from charging higher prices to card users, whereas treyfitty[1] says the Supreme Court ruled merchants can be barred from charging higher prices.

[1] https://news.ycombinator.com/item?id=29126521

Re: How credit cards make money

#354

Post by refurb »

nikitaga wrote: post #287
treyfitty wrote: post #234

One of the under appreciated legal precedents set a couple years ago was the Ohio V AmEx anti trust case. The case predicated against AmEx’s merchant contract forbidding merchants to steer customers away from using their Amex card. This was a common practice for many years, especially at restaurants since AmEx charged restaurants 6%. The Supreme Court ruled that amex was able to keep the anti-steering provision in me…

This has nothing to do with credit cards and everything to do with the kind of people ruling this country, and the kind of systems we have to keep "electing" them. If that case wasn't about AmEx, it would have been about some other random oligopolist, with the same outcome.

You seem to think this was a bad outcome? The ability of a business to steer customers away from a credit card that charges the business high fees?

Re: How credit cards make money

#355

Post by refurb »

nikitaga wrote: post #298
apahwa wrote: post #296

Earlier quoted context omitted.

why is electing in quotes?

Because US election system does not reflect the will of the population, or even the voting population. FPTP is a highly deficient system that results in the same two parties staying in power indefinitely, which is only marginally better than a single party state. So, I find it hard to blame the population for the politicians they elect in this case. US elections are a lot more constrained by the ruling class and the…

What evidence do you have that the politicians elected would be any different under a different system?

I mean, San Francisco uses ranked choice and they ended up through a fluke with some District Attorney who everyone hates.

You may just want to consider that although you may not like the outcome, many voters do?

Re: How credit cards make money

#356

Post by herbst »

rendaw wrote: post #273
bluedevil2k wrote: post #76

Earlier quoted context omitted.

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…

Isn't a lot of the risk of fraudulent charges, etc. due to bad credit card design decisions and outdated technology? Is this something we should be grateful for?

Yes it is. In Europa we use 3d secure some kind of 2fa for credit card payments (online at least, in RL most still use their maestro kind cards) and fraud is more or less a non issue.

Accepting credit card as merchant for years now I only had 2 fraud issues, both using American credit cards.

Re: How credit cards make money

#357

Post by herbst »

TeMPOraL wrote: post #195
morpheuskafka wrote: post #37

> 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…

> At the end of the day, credit cards are still significant better for customers. (...) Yeah, I don't know. Thing is, I don't like the stress involved. I prefer to deal with the money I have, not with the money I hope I'll have in one month's time. Not to mention, the cognitive burden of constantly keeping in mind the various balances and expected money flows, and having to manually push money around. It all feels li…

The only downside are services like Google AdWords or Etsy who don't accept debit cards as credit cards at all.

Re: How credit cards make money

#358

Post by herbst »

lotsofpulp wrote: post #83
stefan_ wrote: post #53

Earlier quoted context omitted.

The intersection between the people that have random overdrafts and those that just pay off their credit card debt in full every time is the empty set. Why make up excuses for a few rent seekers that tax the entire economy?

Merchants WANT people to use credit cards. There is nothing stopping merchants from offering a cash/debit price and a credit price since 10 years ago. The frank dodd legislation made illegal for card networks to ban offering discounts for debit card payments, and in Mar 2017, the Supreme Court said merchants cannot be barred from advertising higher prices for credit cards. https://www.ftc.gov/tips-advice/business-cen…

Merchant here, not only are credit cards the least used option in my shop, but next to PayPal also the most expensive for me as merchant. This is Switzerland tho mind you and most people have what you'd call debit cards.

It's really only a matter of time until I remove credit cards completely in favour of non-US, local, low fee, secure, banking alternatives which already make up the far majority of transactions.

Re: How credit cards make money

#359

Post by discreteevent »

refurb wrote: post #354
nikitaga wrote: post #287

Earlier quoted context omitted.

This has nothing to do with credit cards and everything to do with the kind of people ruling this country, and the kind of systems we have to keep "electing" them. If that case wasn't about AmEx, it would have been about some other random oligopolist, with the same outcome.

You seem to think this was a bad outcome? The ability of a business to steer customers away from a credit card that charges the business high fees?

It is a bad outcome. The high amex fees put up the price of coffee for all customers. Amex are making money from customers they don't even service. It's a scam and the business owner should encourage the customer to pay cash if possible.

Re: How credit cards make money

#360

Post by refurb »

discreteevent wrote: post #359
refurb wrote: post #354

Earlier quoted context omitted.

You seem to think this was a bad outcome? The ability of a business to steer customers away from a credit card that charges the business high fees?

It is a bad outcome. The high amex fees put up the price of coffee for all customers. Amex are making money from customers they don't even service. It's a scam and the business owner should encourage the customer to pay cash if possible.

I’m so confused. The ruling agrees with you?

Edit: nope I was wrong, I read it the other way.

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