4 ms·

I'm not sold on the argument that US credit card swipe fees are a true floor, given that transaction fees fluctuate from country to country somewhat significant

I'm not sold on the argument that US credit card swipe fees are a true floor, given that transaction fees fluctuate from country to country somewhat significantly, though I do agree there's likely a "single transaction floor." That said, I'm not in agreement overall. I think there are likely many things that can be billed in "sub-minimum-transaction-increments," it's just that they only become worth charging when they exceed the floor. So I guess in my head most of it is tracking "microdebt," and only sometimes is combining enough of the outstanding "debt" enough for it to be worth a payment. It's basically a permutation seen in every game with (much hated) in-game currency. Maybe there's dirt cheap things to buy, but you still have to exchange to IGC at a $1:n floor.

PeterisP 6y ago
For an actual example of a single transaction floor in a functioning financial system, the pricing of Euro TIPS transfer system (https://www.ecb.europa.eu/paym/target/tips/html/index.en.html https://www.ecb.europa.eu/paym/target/tips/html/index.en.htm...) may be relevant, where the bulk cost for transferring money between different banks in different countries is much less than a cent per transaction, €0.002. There's some overhead at the sending/receiving institution as well, but it has a similar order of magnitude (0.0005-0.005€/txn mostly depending on your scale because of the fixed costs); the total cost for a proper interbank transfer is less than a cent if you do things right. The price is mostly determined by other factors, not the cost - it can be (and often is) zero for competitiveness purposes, recouping the costs from other services, or it can be something like the same 30 cents as the original article lists if someone is willing to pay that.
- dannyw 6y ago
  Bank transfers don't come with dispute resolution (chargebacks), or credit.
  - littlestymaar 6y ago
    Micropayments don't need to come with them either. Contactless payment don't have chargeback already and are considered as cash (at least in some countries including mine).
  - skeletal88 6y ago
    Neither do debit card payments. Which almost everyone uses here in my part of the EU. Also, the idea of doing a chargeback for something here, is totally alien to the people in my surrounding countries. Chargebacks and distpute resolution and all that stuff is just something people in the us rely on, because using credit cards makes fraud easy. If I use my chip and pin card, then I can be sure that I did the payments. If I rely on a number printed on my card that I have to give someone, then fraud is just too easy. I wish all online credit card transactions would use 3D Secure, but for some reason they don't. The same for when people complain that european bank cards don't have any cashback or other "free" stuff associated with them. People don't realise, that they themselves are paying for that, no? I'm really glad the EU legislated caps on card transaction fees, because moving some bits around can only cost so much.
    - oarsinsync 6y ago
      > Neither do debit card payments. Which almost everyone uses here in my part of the EU. Also, the idea of doing a chargeback for something here, is totally alien to the people in my surrounding countries. Debit cards come with chargebacks. Chargebacks are a feature provided by the payment networks themselves, so it doesn't matter whether you're using a credit or debit card.
    - littlestymaar 6y ago
      There are European countries were chargeback exists (and I wouldn't be surprised if it was the majority of them actually). > I wish all online credit card transactions would use 3D Secure, but for some reason they don't. You realize it's the same kind of “free stuff that comes with a hidden cost” you are complaining about in your rant don't you?
  - PeterisP 6y ago
    Bank transfers (at least in EU) do come with some reasonable consumer protections; it's not to the extent that a chargeback provides in disputes with the merchant (receiver-initiated transfers e.g. direct debit transfers do have similar or even more extensive protections) but it does come with some protections against fraud, e.g. if your credentials were stolen and misused to make payments that you did not authorize, then you would be able to recover your money, unlike cryptocurrencies.

PeterisP 6y ago

For an actual example of a single transaction floor in a functioning financial system, the pricing of Euro TIPS transfer system (https://www.ecb.europa.eu/paym/target/tips/html/index.en.html https://www.ecb.europa.eu/paym/target/tips/html/index.en.htm...) may be relevant, where the bulk cost for transferring money between different banks in different countries is much less than a cent per transaction, €0.002. There's some overhead at the sending/receiving institution as well, but it has a similar order of magnitude (0.0005-0.005€/txn mostly depending on your scale because of the fixed costs); the total cost for a proper interbank transfer is less than a cent if you do things right. The price is mostly determined by other factors, not the cost - it can be (and often is) zero for competitiveness purposes, recouping the costs from other services, or it can be something like the same 30 cents as the original article lists if someone is willing to pay that.

dannyw 6y ago
Bank transfers don't come with dispute resolution (chargebacks), or credit.
- littlestymaar 6y ago
  Micropayments don't need to come with them either. Contactless payment don't have chargeback already and are considered as cash (at least in some countries including mine).
- skeletal88 6y ago
  Neither do debit card payments. Which almost everyone uses here in my part of the EU. Also, the idea of doing a chargeback for something here, is totally alien to the people in my surrounding countries. Chargebacks and distpute resolution and all that stuff is just something people in the us rely on, because using credit cards makes fraud easy. If I use my chip and pin card, then I can be sure that I did the payments. If I rely on a number printed on my card that I have to give someone, then fraud is just too easy. I wish all online credit card transactions would use 3D Secure, but for some reason they don't. The same for when people complain that european bank cards don't have any cashback or other "free" stuff associated with them. People don't realise, that they themselves are paying for that, no? I'm really glad the EU legislated caps on card transaction fees, because moving some bits around can only cost so much.
  - oarsinsync 6y ago
    > Neither do debit card payments. Which almost everyone uses here in my part of the EU. Also, the idea of doing a chargeback for something here, is totally alien to the people in my surrounding countries. Debit cards come with chargebacks. Chargebacks are a feature provided by the payment networks themselves, so it doesn't matter whether you're using a credit or debit card.
  - littlestymaar 6y ago
    There are European countries were chargeback exists (and I wouldn't be surprised if it was the majority of them actually). > I wish all online credit card transactions would use 3D Secure, but for some reason they don't. You realize it's the same kind of “free stuff that comes with a hidden cost” you are complaining about in your rant don't you?
- PeterisP 6y ago
  Bank transfers (at least in EU) do come with some reasonable consumer protections; it's not to the extent that a chargeback provides in disputes with the merchant (receiver-initiated transfers e.g. direct debit transfers do have similar or even more extensive protections) but it does come with some protections against fraud, e.g. if your credentials were stolen and misused to make payments that you did not authorize, then you would be able to recover your money, unlike cryptocurrencies.