6 ms·

Visa to Offer Person-to-person Payments (to compete with PayPal)

65 points by srgseg 16y ago

thinkcomp 16y ago
This seems about ten years too late.
- alexgartrell 16y ago
  In this particular case, better late than never. I'm also relatively certain that Visa will be in a strong position to dominate the space, if only because of their brand presence. I'd much rather get online with my Visa Card (which is hooked up directly to my bank account, as it is for many other PNC customers and, I'm guessing, customers of other banks) to transfer money to my friend than I would write him a check. On the other hand, I don't have a Paypal account, and would be unlikely to want to screw with it. I think there will be a lot of people who see this like I do.
  - deleted 16y ago
    [deleted]
- smokinn 16y ago
  Well, 10 years ago paypal was 3 years old and the space was very far from proven. Person-to-person payments still suck. I don't want to use paypal thanks in part to the stories about them freezing funds with no recourse but also because it's yet another account to manage. Visa on the other hand has a huge established base and if they can make it easy (send x$ to CC No XXXX-XXXX-XXXX-XXXX? and that's it) I would definitely use it. And since Visa is huge and has partnerships everywhere if this takes off in the slightest Mastercard will jump on board and suddenly nearly everyone with a credit card can accept payments from each other. Paypal's revenue will take a good hit for sure. Big companies, especially in the financial sector, don't hop into a new market until it's both stable and large enough to make it worth their while. Person-to-person has now been proven to be big and viable by Paypal so the CC companies are right on schedule to try to muscle their way in and eat Paypal's lunch.
- bennysaurus 16y ago
  Some banks have had this ability even in credit for a long while. The reason it has taken so long for the likes of VISA to join the crowd is the ironing out of issues like money laundering.
- mbesto 16y ago
  I just moved to the UK from the US. The concept of sending people money via PayPal is more or less non-existent within the country. Why? Because you just get someone's bank details and transfer the money. I pay all of my bills via bank transfer. Oh, and it's free. It astounds me how easy it is to do. From Barclay's to HSBC for example (I pay my flatmate this way) it transfers it almost in a few hours. Why can't the US do this? Too much money in it for the banks?
  - elai 16y ago
    They can, they just charge an arm and a leg for it and make you go through a big hoop and dance to actually use it. Wire transfers cost $20-$40 for each transaction (And usually are associated with systems with such names as "Large Value Transfer System (LVTS)". ACH is usually only allowed with accounts you can prove ownership with and they charge for pushing money into another external account, but usually not for pulling money. Even then they hold the funds for 3-4 business days. It's cheaper and faster to just order paper checks, write them down, give it to a teller or ABM to take the check to deposit into your account than to use ACH or wire transfers. It's even worse in canada. At least US banks have ACH transfers and wire transfers available on their online banking websites! The closest thing is Interac e-transfer. I think it just comes down to liability and fraud risk exposure. A guy who knows your password can clean you out.
srgseg 16y ago
Also covered here: http://mashable.com/2011/03/16/visa-personal-payments/ http://mashable.com/2011/03/16/visa-personal-payments/ "...to send and receive funds to any eligible Visa credit, debit or prepaid account anywhere in the world."
- copper 16y ago
  As someone who saw the fun Paypal had with the Indian government, I suspect the key word in that above quote is "eligible"
siculars 16y ago
Any viable competitor to the Paypal tyranny would be quite welcome. Competition is a good thing.
ck2 16y ago
Assuming the fees are reasonable and competitive, I will definitely use and recommend this, thanks for taking the risk Visa. Now Google, when are you going to step up to the plate?
- danssig 16y ago
  What makes you think Google would be any less evil than Paypal?
  - mdaniel 16y ago
    1. PayPal doesn't have a corporate motto of "Don't be evil" 2. We have existing data for the big G via their Google Payments
    - trezor 16y ago
      1. PayPal doesn't have a corporate motto of "Don't be evil" If you think Google wont do bad stuff because of a good PR-stunt, my personal motto is also "Don't be evil" and boy do I have a bridge to sell you. You may be affiliated with Google trough some of your former projects and don't want to think you are part of something bad, I don't know. But as an end-user who only sees Google's complete dominance all over the web, as the company who now anonymizes search/keyword-data for site-owners, unless you deploy Google Analytics and further increases Google's grip on the web, etc etc, I see a big beast who could go monster overnight with the rest of the internet powerless to stop it. Google may not be evil now, but being OK with the power they wield just because they aren't abusing that power is something I cannot be content with. A silly "Don't be evil" motto isn't going to change that. I'll welcome good options anywhere I can find them, and I don't use Google's products for anything I can't replace with something else. Having another non-Google option in the Android market would be very much welcomed. Especially considering Google Checkout's extremely poor track-record.
      - danssig 16y ago
        Not to mention the fact that even if, against all odds, Larry and Serge truly are completely benevolent they aren't going to live forever. At some point they'll get bored and leave or get old and die. Then the next guy will step into a company that owns most of the web...
trustfundbaby 16y ago
As long as Paypal has some serious competition ... I'm happy. Maybe now they'll treat customers with a little bit of respect.
follower 16y ago
It's an odd day when a market sector is so messed up that it seems like a good thing that a credit card company is entering it. I hope their entry somehow improves the behavior of both companies. (Although I note it seems it will be US only for the moment.)
- nkassis 16y ago
  Well to be fair Visa isn't responsible for some the of the crazy credit card stuff. They provide the network, fraud detection etc. Blame the lenders for the bad terms.
  - dangrossman 16y ago
    Visa's responsible for most of the reasons people hate PayPal. - Visa's the reason PayPal holds sellers 100% liable for fraudulent payments. - Visa's the reason PayPal holds funds for a minimum of 6 months if they freeze an account. - Visa's the reason for PayPal denying an account to that "sell experiences" startup that complained on HN a week or two ago. - Visa's the reason PayPal is so quick to freeze an account for anything resembling a risk, because Visa requires its processors stay under a ~1% chargeback ratio (in % of volume, which means far less than 1% of transactions since the fraudulent ones tend to be the bigger ones). Sure PayPal shares some of the blame for their customer support issues, but the reasons people have to deal with support in the first place usually boil down to Visa operating regulations that PayPal's policies are built around.
    - cabalamat 16y ago
      How is Visa responsible for all this?
      - mfringel 16y ago
        How is Visa responsible for all this? Because Paypal's general annoyance factor is (likely) the path of least resistance for compliance with Visa's rules for a person-to-person payment service.
bdonlan 16y ago
Does this mean I'd have to give someone my credit card number to have them pay me? Or would they have a separate deposit-only account identifier?

65 points by srgseg 16y ago

thinkcomp 16y ago

This seems about ten years too late.

alexgartrell 16y ago
In this particular case, better late than never. I'm also relatively certain that Visa will be in a strong position to dominate the space, if only because of their brand presence. I'd much rather get online with my Visa Card (which is hooked up directly to my bank account, as it is for many other PNC customers and, I'm guessing, customers of other banks) to transfer money to my friend than I would write him a check. On the other hand, I don't have a Paypal account, and would be unlikely to want to screw with it. I think there will be a lot of people who see this like I do.
- deleted 16y ago
  [deleted]
smokinn 16y ago
Well, 10 years ago paypal was 3 years old and the space was very far from proven. Person-to-person payments still suck. I don't want to use paypal thanks in part to the stories about them freezing funds with no recourse but also because it's yet another account to manage. Visa on the other hand has a huge established base and if they can make it easy (send x$ to CC No XXXX-XXXX-XXXX-XXXX? and that's it) I would definitely use it. And since Visa is huge and has partnerships everywhere if this takes off in the slightest Mastercard will jump on board and suddenly nearly everyone with a credit card can accept payments from each other. Paypal's revenue will take a good hit for sure. Big companies, especially in the financial sector, don't hop into a new market until it's both stable and large enough to make it worth their while. Person-to-person has now been proven to be big and viable by Paypal so the CC companies are right on schedule to try to muscle their way in and eat Paypal's lunch.
bennysaurus 16y ago
Some banks have had this ability even in credit for a long while. The reason it has taken so long for the likes of VISA to join the crowd is the ironing out of issues like money laundering.
mbesto 16y ago
I just moved to the UK from the US. The concept of sending people money via PayPal is more or less non-existent within the country. Why? Because you just get someone's bank details and transfer the money. I pay all of my bills via bank transfer. Oh, and it's free. It astounds me how easy it is to do. From Barclay's to HSBC for example (I pay my flatmate this way) it transfers it almost in a few hours. Why can't the US do this? Too much money in it for the banks?
- elai 16y ago
  They can, they just charge an arm and a leg for it and make you go through a big hoop and dance to actually use it. Wire transfers cost $20-$40 for each transaction (And usually are associated with systems with such names as "Large Value Transfer System (LVTS)". ACH is usually only allowed with accounts you can prove ownership with and they charge for pushing money into another external account, but usually not for pulling money. Even then they hold the funds for 3-4 business days. It's cheaper and faster to just order paper checks, write them down, give it to a teller or ABM to take the check to deposit into your account than to use ACH or wire transfers. It's even worse in canada. At least US banks have ACH transfers and wire transfers available on their online banking websites! The closest thing is Interac e-transfer. I think it just comes down to liability and fraud risk exposure. A guy who knows your password can clean you out.

srgseg 16y ago

Also covered here: http://mashable.com/2011/03/16/visa-personal-payments/ http://mashable.com/2011/03/16/visa-personal-payments/ "...to send and receive funds to any eligible Visa credit, debit or prepaid account anywhere in the world."

copper 16y ago
As someone who saw the fun Paypal had with the Indian government, I suspect the key word in that above quote is "eligible"

siculars 16y ago

Any viable competitor to the Paypal tyranny would be quite welcome. Competition is a good thing.

ck2 16y ago

Assuming the fees are reasonable and competitive, I will definitely use and recommend this, thanks for taking the risk Visa. Now Google, when are you going to step up to the plate?

danssig 16y ago
What makes you think Google would be any less evil than Paypal?
- mdaniel 16y ago
  1. PayPal doesn't have a corporate motto of "Don't be evil" 2. We have existing data for the big G via their Google Payments
  - trezor 16y ago
    1. PayPal doesn't have a corporate motto of "Don't be evil" If you think Google wont do bad stuff because of a good PR-stunt, my personal motto is also "Don't be evil" and boy do I have a bridge to sell you. You may be affiliated with Google trough some of your former projects and don't want to think you are part of something bad, I don't know. But as an end-user who only sees Google's complete dominance all over the web, as the company who now anonymizes search/keyword-data for site-owners, unless you deploy Google Analytics and further increases Google's grip on the web, etc etc, I see a big beast who could go monster overnight with the rest of the internet powerless to stop it. Google may not be evil now, but being OK with the power they wield just because they aren't abusing that power is something I cannot be content with. A silly "Don't be evil" motto isn't going to change that. I'll welcome good options anywhere I can find them, and I don't use Google's products for anything I can't replace with something else. Having another non-Google option in the Android market would be very much welcomed. Especially considering Google Checkout's extremely poor track-record.
    - danssig 16y ago
      Not to mention the fact that even if, against all odds, Larry and Serge truly are completely benevolent they aren't going to live forever. At some point they'll get bored and leave or get old and die. Then the next guy will step into a company that owns most of the web...

trustfundbaby 16y ago

As long as Paypal has some serious competition ... I'm happy. Maybe now they'll treat customers with a little bit of respect.

follower 16y ago

It's an odd day when a market sector is so messed up that it seems like a good thing that a credit card company is entering it. I hope their entry somehow improves the behavior of both companies. (Although I note it seems it will be US only for the moment.)

nkassis 16y ago
Well to be fair Visa isn't responsible for some the of the crazy credit card stuff. They provide the network, fraud detection etc. Blame the lenders for the bad terms.
- dangrossman 16y ago
  Visa's responsible for most of the reasons people hate PayPal. - Visa's the reason PayPal holds sellers 100% liable for fraudulent payments. - Visa's the reason PayPal holds funds for a minimum of 6 months if they freeze an account. - Visa's the reason for PayPal denying an account to that "sell experiences" startup that complained on HN a week or two ago. - Visa's the reason PayPal is so quick to freeze an account for anything resembling a risk, because Visa requires its processors stay under a ~1% chargeback ratio (in % of volume, which means far less than 1% of transactions since the fraudulent ones tend to be the bigger ones). Sure PayPal shares some of the blame for their customer support issues, but the reasons people have to deal with support in the first place usually boil down to Visa operating regulations that PayPal's policies are built around.
  - cabalamat 16y ago
    How is Visa responsible for all this?
    - mfringel 16y ago
      How is Visa responsible for all this? Because Paypal's general annoyance factor is (likely) the path of least resistance for compliance with Visa's rules for a person-to-person payment service.

bdonlan 16y ago

Does this mean I'd have to give someone my credit card number to have them pay me? Or would they have a separate deposit-only account identifier?