14 ms·
It's interesting to see: - Square become Stripe, while Stripe becomes Square - Stripe owning the whole user experience in purchasing - If they own the physic
by csytan 8y ago
It's interesting to see:
- Square become Stripe, while Stripe becomes Square
- Stripe owning the whole user experience in purchasing
- If they own the physical end points, will they eventually cut out credit card companies? You can already see that they are pushing for collecting emails with checkout.js. The first step is to have direct contact with the end user.
- If they cut out credit card companies, what's to stop them from moving into personal payments (e.g. Square Cash, Venmo) and then banking?
- n3d1m 8y agoNothing stopping them. And I wish they would. The MC/Visa duopoly needs to be disrupted.
- Silhouette 8y agoThe MC/Visa duopoly needs to be disrupted. Yes, but not by anything even vaguely resembling credit cards as we know them today. The whole system is insecure, inefficient and unreliable by design, and the credit aspect introduces an extra level of legal and financial mess, particularly for those people who just want a convenient payment method but don't actually need to defer settlement. Card payments may be the perfect example of the dangers of monopolies and oligopolies.
- Sir_Cmpwn 8y agoWhat, and replaced with another monopoly?
- jimnotgym 8y agoOr a duopoly of Stripe and Applepay?
- jjeaff 8y ago>nothing is stopping them. I'm guessing their Network agreements with Visa and MasterCard would stop them. You could issue a stripe card that only works with stripe merchants. But I can't imagine visa allowing their imprint on a card that can both process anywhere AND be used to slowly cut visa out of the picture.
- dagss 8y agoMany European cards have both the VISA logo and also a national chip&pin debit scheme that has nothing to do with VISA.
- dna_polymerase 8y agoMaybe you should take a look at the hard numbers before you talk about cutting out the CC companies. Paypal is leading the game and they are not able to cut out CC companies.
- jrockway 8y agoI don't see much Paypal deployment in the physical world. The only place I've ever seen the option to pay with Paypal is at Home Depot. (I didn't try it because it sounded like you had to log in with your password and second factor... which did not sound like a good use of time in the checkout line.)
- the_clarence 8y agoOr annoyingly, donations t9 websites like Wikipedia require Paypal
- yorwba 8y agoMaybe it depends on the country you're in, but you can definitely use methods other than PayPal. When I donate to projects with foundations in Europe, I usually just wire the money directly to their bank account. (I'm in Germany.)
- nathancahill 8y agoPhone number and 4 digit pin, super easy actually.
- dannyw 8y agoI’m confused. I pay with PayPal balance all the time.
- dna_polymerase 8y agoGood for you. Question: Do credit cards still exists, outside of your bubble?
- docker_up 8y agoYou can't cut out the cc companies. Both Stripe and Square are riding on their rails. The best they can do is try to negotiate the rates down and either keep a higher percentage for themselves or pass on the savings to their customers.
- wbronitsky 8y agoI think the interesting idea is what happens when you use a Stripe issued card[0] on a Stripe API powered terminal. The system, somewhere, will know it is a Stripe card based off the number, but I'm willing to bet the CC networks are protected from being cut out. At least for now. Great job team! Looking forward to more of this in the future \o/ [0] https://stripe.com/issuing https://stripe.com/issuing
- Domenic_S 8y agoThey're protected from being cut out because they are the networks on which the credit card system runs. If you look at a stripe-issued card, you'll see there's still a visa or mc logo in the corner.
- wbronitsky 8y agoI understand how the system works; the requests hit the API before the credit card network. Hence the ability to cut out the network if Stripe is willing to take the chargeback/fraud risk.
- docker_up 8y agoNo, they would need to become money transmitters according to what you wrote above. AFAIK they aren't money transmitters yet.
- wbronitsky 8y agoIt depends on the jurisdiction, but they are in many! It is something they have been working towards for quite some time.
- lefrancaiz 8y agoThey're still one step away from Square. This is Stripe Terminal and not Stripe POS. This competes more with Square Reader SDK. If I remember correctly Square Reader SDK only launched fairly recently. Your point is still valid, but I just wanted to point out that building a POS like Square is a different beast.
- rossdavidh 8y agoI'm sure they've thought about it. However, as others have found, getting through the amount of fraud out there with a margin less than the ~3% that credit card companies charge, is really hard. I mean if you were perfect that would be 3% profit. If your uncaught fraud rate is even a few percent higher than that of companies who have been doing this for a long time, you will be bleeding money. Again, I'm sure they've thought of it, but the credit card companies are actually pretty good at a very hard task, which is enabling super-easy and quick payment verification without getting eaten alive by fraud.
- draw_down 8y ago> getting through the amount of fraud out there with a margin less than the ~3% that credit card companies charge, is really hard It is hard. Wonder if they're doing anything about that...
- jimnotgym 8y ago> without getting eaten alive by fraud. Because fraudulent use of cards is charged back to the merchant, the card companies are less exposed to it than you might imagine. Where they are exposed is if a merchant goes bankrupt without delivering, and the purchase was on credit card. The merchant account holder would then be liable
- rossdavidh 8y agoBut, they have to maintain a system to deal with that. Also, if they pass all fraud back to the merchants, at the levels that would happen if they had no good fraud detection, then merchants would stop allowing credit cards. We take for granted that most transactions are valid. If the credit card companies did not invest a lot in automatic fraud detection, the percentage of fraudulent transactions would be something like the percentage of email which is spam.
- jimnotgym 8y agoThey still leave much of the risk to the merchant. Turn on 3d secure, watch how the banks often don't even respond, and watch the conversions plummet as your hard won customers get caught in a whirling loop. Turn on all the fraud tools and watch how nobody ever checks-out again...
- GordonS 8y ago> If they own the physical end points, will they eventually cut out credit card companies? I seem to recall a story on HN around 6 months ago about Mastercard (might have been Visa) becoming an investor in Stripe, so I they'll do whatever they need to to keep Stripe in check.
- eastbayjake 8y agoIt was Visa: http://fortune.com/2015/07/28/stripe-visa/ http://fortune.com/2015/07/28/stripe-visa/
- pbreit 8y agoI can't help but think Square ceded the online space to Stripe despite that probably 50% or more of Square's merchants process online with another vendor.
- oneplusone 8y agoI believe Stripe's original plan when they applied to YC was to start a bank.
- deleted 8y ago[deleted]