4 ms·
Presumably this is to pay for all the points people get by using cards, not to mention the sign up promotions. I like how in Europe and Australia interchange f
by rb808 8y ago
Presumably this is to pay for all the points people get by using cards, not to mention the sign up promotions.
I like how in Europe and Australia interchange fees are capped. Even if it means they live without such bountiful premium cards.
https://en.wikipedia.org/wiki/Interchange_fee https://en.wikipedia.org/wiki/Interchange_fee
>> In the United States, the fee averages approximately 2% of transaction value.[2] In the EU, interchange fees are capped to 0.3% of the transaction for credit cards and to 0.2% for debit cards.[3]
- altmind 8y agoI think the points are fully paid by avg 21% APR, $37 late fees, interchange fees, foreign transaction fees(2%) and ATM fees on credit cards. Its just greed.
- liquidwax 8y agoSaw a video by vox today where they argue that the points are also paid by increased retail prices. Even if you decide to use cash, you are basically paying for someone's business class upgrades https://www.youtube.com/watch?v=ySH5SudRwak https://www.youtube.com/watch?v=ySH5SudRwak
- yborg 8y agoAnd the card holder pays with their privacy as well, that data stream is also monetized.
- KorematsuFred 8y agoThe Chinese store I buy from offers me discounts if I pay in cash. He offers me 5% discount on furniture and also gives me a proper invoice (so he is not really defrauding the tax authorities either).
- empath75 8y agoYeah but the people getting the points aren't the people paying those fees. It's mostly a wealth transfer from the poor to the well off. It's grotesque, and I think they should be banned.
- zanmat0 8y agoNo one is being forced to spend money they don't have.
- jbob2000 8y agoPoints aren’t managed by visa or MC, it’s the card issuer that does it.
- gringoDan 8y agoHere is an in-depth overview of who ends up losing out with the credit card rewards system we have in the US: https://www.reddit.com/r/churning/comments/5oucdq/the_economics_of_churning_who_pays_for_the_rewards/ https://www.reddit.com/r/churning/comments/5oucdq/the_econom...
- miohtama 8y agoEU is also considering an alternative, more real transaction cost based, rails for the Visa/MC system https://www.finextra.com/newsarticle/33339/ecb-chief-says-instant-payments-could-break-visamastercard-duopoly https://www.finextra.com/newsarticle/33339/ecb-chief-says-in...
- canada_dry 8y ago> pay for all the points people get More like stagnant growth and very few levers to increase their (Visa/Mcard) bottom line - which, of course, shareholders demand. Issuing banks and acquirers deal with the points people get. Source: was in the industry for a dozen years.