3 ms·

the nash equilibrium is weird. Customers are incentivized to carry credit cards because of cash back rewards, need for a short term loan, convenience of not ha

the nash equilibrium is weird. Customers are incentivized to carry credit cards because of cash back rewards, need for a short term loan, convenience of not having to carry cash, and fraud protection. Merchants are incentivized to accept credit cards because many potential customers carry little cash because it is inconvenient. And in all this, we are implicitly paying a 2-3% tax for everything we buy that goes straight to the credit card companies.

scott_s 8y ago
mikeash makes a different point, one I often make: accepting cash is not free. It's a physical item that can get lost or stolen, which means it needs significant physical security when storing or transporting. There are card-only stores, and I imagine the reason is how much is simplifies their physical logistics. (No need for cashing out drawers at the end of shifts, no need for safes on site, no need to pay a company to transport cash to the bank.) How much does that cost the consumer? Is it less or more than the "tax" what we pay to the credit card companies?
- killjoywashere 8y ago
  I'm reasonably confident I lose, burn, have stolen from me, or otherwise fail to enjoy the benefit of far less than 2 of every hundred dollars in my wallet.
  - anothergoogler 8y ago
    That's just not living. Try smoking a Jackson some time.
    - mateo411 8y ago
      What's a Jackson? A twenty dollar bill?
      - anothergoogler 8y ago
        It is.
- actsasbuffoon 8y ago
  Not to mention the significant fraud risks when dealing with cash. Many years ago I worked retail. A few minutes after I sold something to a man, he came back to my counter angrily. He said I'd given him change for a $20, but he'd given me a $50. I was quite certain he'd given me a $20 and he was trying to steal from us. This is not a pleasant situation to be in, and it wouldn't have been possible if he'd paid with a card.
jasonkostempski 8y ago
Don't debit cards give much of the same benefits for both parties as CCs, and aren't they much cheaper to process? I know sometimes their can be a buyer fee associated with a debit card but I've never had one that did. My bank card can be used as either. I use debit when given the option specifically because I thought it was cheaper for sellers in most cases.
- dogma1138 8y ago
  Debit cards don’t offer insurance and fraud and purchase protection to the same extent or at all at least in Europe. Reversing a card transaction on a CC is one call away on debit GL with that.

scott_s 8y ago

mikeash makes a different point, one I often make: accepting cash is not free. It's a physical item that can get lost or stolen, which means it needs significant physical security when storing or transporting. There are card-only stores, and I imagine the reason is how much is simplifies their physical logistics. (No need for cashing out drawers at the end of shifts, no need for safes on site, no need to pay a company to transport cash to the bank.) How much does that cost the consumer? Is it less or more than the "tax" what we pay to the credit card companies?

killjoywashere 8y ago
I'm reasonably confident I lose, burn, have stolen from me, or otherwise fail to enjoy the benefit of far less than 2 of every hundred dollars in my wallet.
- anothergoogler 8y ago
  That's just not living. Try smoking a Jackson some time.
  - mateo411 8y ago
    What's a Jackson? A twenty dollar bill?
    - anothergoogler 8y ago
      It is.
actsasbuffoon 8y ago
Not to mention the significant fraud risks when dealing with cash. Many years ago I worked retail. A few minutes after I sold something to a man, he came back to my counter angrily. He said I'd given him change for a $20, but he'd given me a $50. I was quite certain he'd given me a $20 and he was trying to steal from us. This is not a pleasant situation to be in, and it wouldn't have been possible if he'd paid with a card.

jasonkostempski 8y ago

Don't debit cards give much of the same benefits for both parties as CCs, and aren't they much cheaper to process? I know sometimes their can be a buyer fee associated with a debit card but I've never had one that did. My bank card can be used as either. I use debit when given the option specifically because I thought it was cheaper for sellers in most cases.

dogma1138 8y ago
Debit cards don’t offer insurance and fraud and purchase protection to the same extent or at all at least in Europe. Reversing a card transaction on a CC is one call away on debit GL with that.