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Could you clarify? Is this markup only on card present transactions?
by Zombieball 8y ago
Could you clarify? Is this markup only on card present transactions?
- deleted 8y ago[deleted]
- tyingq 8y agoIt's specific to the US. Within the US, if have your own merchant account, "card present" is a lot cheaper than "card not present". So far, companies like Paypal, Square, and now Stripe, don't pass those savings on. They all have one rate that doesn't differentiate.
- docker_up 8y agoMore importantly, fraud rates are much lower with CP than CNP. If the Visa/MC in the US goes with a PIN-type system like the rest of the world, fraud rates drop to near zero, which makes Card Present insanely profitable for them.
- jdmichal 8y agoCard-present transactions are typically cheaper, because the risk of fraud is better mitigated. With chip cards, the fraud risk for card-present is almost entirely in physically stolen cards. (Sophisticated shops could duplicate magnetic stripes. That's a lot harder to do with chips.) Compared to online, where all you have is the card number and the CVV, both of which are easily duplicated. And this is why tokenization is such a big deal. Tokenization means you don't store the actual card number, and the token you do store is tied directly to your merchant, so it's not widely reusable.