Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

finance.yahoo.com

Post reply on HN
Print view View original

361–370 of 386 posts

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#361

Post by tlogan »

rsynnott wrote: post #301
tlogan wrote: post #91

Earlier quoted context omitted.

Yes, but the EU is quite diverse. I have some Irish friends. And Ireland seems similar to the US when it comes to credit card usage (vs debit). I assume that is because Ireland is heavily influenced by US and UK banking habits. On other hand, Germans only use debit cards.

> And Ireland seems similar to the US when it comes to credit card usage (vs debit). That's definitely not the case. Many people would have credit cards, but there's a lot less incentive to actually use them than there is in the US, because the interchange (paid ultimately by the merchant) is capped at 0.3% in the EU (whereas in the US it can be upward of 3% on high-end cards). The interchange pays for the 'reward' s…

> Without those, why bother?

Peace of mind (that your checking account is not drained)?

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#362

Post by amanaplanacanal »

bdangubic wrote: post #354
triceratops wrote: post #269

Earlier quoted context omitted.

That's a common misconception. Credit score is positively correlated with paying on time, having high available credit relative to usage, and the age of your oldest credit account. However, using more of your cards' limit (a high debt utilization ratio) actually reduces your score. On-time payments are only one factor in your score. Depending on the model it may only account for 20-30% of the score. Using your cards…

can 100% confirm this on a personal level, outside of mortgage I have no credit card balances (I use CC extensively but always pay the full balance) and have had 835+ score for years now.

Yes. They want you to have the mortgage and the cards, and the record of paying them on time. If you had no mortgage and never had the credit cards, your score would be much lower.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#363

Post by Hikikomori »

l23k4 wrote: post #347
Hikikomori wrote: post #341

Earlier quoted context omitted.

Some Europeans meaning people in Germany? Most people have debit cards from our normal banks here, credit cards are generally associated with companies like Revolut or Klarna, as they push ads for getting credit cards.

> Some Europeans meaning people in Germany? I guess, I haven't really kept track, but I've observed this many times from different people. > credit cards are generally associated with companies like Revolut That's surprising. Revolut only offers credit cards in a couple of countries, and has only done so for a rather short period of time.

Maybe it was remember I was thinking of, there's a few that push credit card with ads

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#364

Post by triceratops »

amanaplanacanal wrote: post #362
bdangubic wrote: post #354

Earlier quoted context omitted.

can 100% confirm this on a personal level, outside of mortgage I have no credit card balances (I use CC extensively but always pay the full balance) and have had 835+ score for years now.

Yes. They want you to have the mortgage and the cards, and the record of paying them on time. If you had no mortgage and never had the credit cards, your score would be much lower.

I've had a high score with only credit cards and low usage.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#365

Post by ano-ther »

egorfine wrote: post #329
ano-ther wrote: post #153

Here is a more technical description: https://link.springer.com/article/10.1007/s12525-025-00822-7 I am still not quite sure how this would affect my day-to-day (private) payment experience transaction cost etc. But is has strategic value for Europe: > [...] European dependencies in critical technologies. A digital euro could mitigate these developments in the medium term if the infrastructure is mainly operated by E…

> how this would affect my day-to-day (private) payment experience You will need to pass KYC at every counter.

Well they already know me. I make about one small payment per quarter in cash, everything else via phone, card or bank transfer.

So I don’t see the day-to-day difference with digital euro, except that the backend seems to have fewer intermediaries (and maybe lower cost for the merchant?). Also it would work in more than one country which is good.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#366

Post by lxgr »

port11 wrote: post #356
margalabargala wrote: post #223

Earlier quoted context omitted.

As a US-ian I feel exactly that way when using a debit card. A credit card, if misused, can run up your balance and then you dispute, and don't pay anything until it's resolved. A debit card, if misused, can drain your account and leave you penniless until it's resolved.

The two times someone cloned my credit card were a) while travelling in the US; b) complaints that VISA didn’t refund. So there’s that.

Visa isn't a party to your contract with your card issuing bank. Your bank is responsible for filing a dispute, representing it properly, and (according to applicable law and/or as a good business practice for somebody that wants to retain your business) potentially reimbursing you out of pocket if a given transaction has issuing bank fraud liability.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#367

Post by lxgr »

raron wrote: post #275
margalabargala wrote: post #268

Earlier quoted context omitted.

Multiple accounts (both debit and credit) are normal in the US as well, but I have never heard of a debit account here that has a daily spending limit. Sounds like the US and Euro systems work fine within their own borders. Solutions designed for one make less sense in the context of the other.

It gets interesting when the two system interacts. Friends visiting the US told me that at the POS terminal they had to choose credit card despite paying with a Visa/Mastercard debit card issued by an European bank. By the way, here banks even have daily bank / wire transfer limit that can be changed only by a personal visit to a branch, so even if your online banking credentials are stolen, the attacker can not empt…

> Friends visiting the US told me that at the POS terminal they had to choose credit card despite paying with a Visa/Mastercard debit card issued by an European bank.

The "credit" button in the US really means "use the Visa/Mastercard network and don't ask me for a PIN", as opposed to "feel free to ask me for my PIN and route the transaction over one of a dozen or so US domestic debit networks". The question doesn't even make sense for non-US debit cards.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#368

Post by margalabargala »

mrtksn wrote: post #320
margalabargala wrote: post #223

Earlier quoted context omitted.

As a US-ian I feel exactly that way when using a debit card. A credit card, if misused, can run up your balance and then you dispute, and don't pay anything until it's resolved. A debit card, if misused, can drain your account and leave you penniless until it's resolved.

Yep, that's why I always used CC and pay in full(until it become much more logical to pay the minimum and accumulate interest that is lower than the inflation). It's much better to be indebted when buying something simply because if something goes wrong its much easier to convince someone to take their thing back when you haven't paid yet than trying to convince someone to send your money back and accept a return.

I've never seen a CC with an APR below 20%, which inflation has never hit in the US. But the logic is sound as long as your income is tracking inflation.

Your second paragraph is accurate.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#369

Post by margalabargala »

expedition32 wrote: post #359
margalabargala wrote: post #223

Earlier quoted context omitted.

As a US-ian I feel exactly that way when using a debit card. A credit card, if misused, can run up your balance and then you dispute, and don't pay anything until it's resolved. A debit card, if misused, can drain your account and leave you penniless until it's resolved.

The solution is not to misuse your card. Don't do business with shady companies- problem solved.

Unfortunately, the reality is that rather than your card being directly misused by a "shady" company, it's more likely that most companies you transact with do not have perfect security and will suffer a data breach that may expose your payment information.

Re: Digital euro clears key hurdle as EU seeks to break free from U.S. credit cards

#370

Post by lxgr »

tialaramex wrote: post #259
tlogan wrote: post #181

Earlier quoted context omitted.

Germany is very debit-card oriented (with no interest of switching). The Netherlands seems similar. Eastern Europe and the Balkans are also mostly debit-card oriented, but people seem more open to switching to credit cards (if they can get one - especially the younger generation). Ireland and the U.K. seem much more credit-card oriented than rest of Europe. Turkey is also very CC oriented (kinda strange - was not exp…

The preferential treatment of credit cards for certain transactions influences how they're used in the UK. Suppose in January two people Carol and Dave bought a £250 August flight to Paris from some outfit that didn't do a great job hedging their fuel prices. Carol used her credit card, Dave used his Debit card. UK law says Carol's flight was bought by her bank, after all her bank handed over the money, Carol is on t…

> The Section 75 protections mean Brits who are credit-worthy tend to pay for large purchases on a [credit] card even if they intend to pay it off immediately.

And Visa and Mastercard's global zero liability provisions protect everybody with a debit card, so de facto the difference is no longer relevant.

That said, some banks are pretty bad at making use of their dispute rights with the networks. I've seen several German issuers actually refuse to file "service not provided" disputes in case of a large airline bankruptcy a few years ago. (German bankruptcy managers can be somewhat intimidating rhetorically, but fortunately their personal opinions have no bearing on banking/payment laws.)

Post reply on HN