3 ms·

Where are you located that visa and MasterCard are charging 3%? In the EU the fees are limited to 0.3%, and in other areas (e.g. the UK) it's 1%. As a card hol

Where are you located that visa and MasterCard are charging 3%? In the EU the fees are limited to 0.3%, and in other areas (e.g. the UK) it's 1%. As a card holder I'm pretty happy to pay a ~0.3% service fee to know that I have recourse with a merchant, for example. > I just want an efficient low-cost barrierless payment network. Whats low cost to you then?

hocuspocus 5y ago
Note that the 0.3% cap is on the interchange, i.e. the fee that goes back to the card issuer, it doesn't affect Visa and Mastercard directly. PSPs in the EU/EEA charge around 1% overall, a bit more to small businesses (for instance SumUp), and a bit less to the really big retailers that have more bargaining power.
- maccard 5y ago
  I'm aware of that, but OP was talking about 3% of his transaction going to visa/mc, not stripe/sumup.
xvello 5y ago
> Where are you located that visa and MasterCard are charging 3%? I am guessing the good old unregulated free market of the US of A: https://www.valuepenguin.com/what-credit-card-processing-fees-costs https://www.valuepenguin.com/what-credit-card-processing-fee... There, banks and credit card companies offer huge perks and cash-back to card holders. That money must come from somewhere, and that's from the transaction fees paid by merchants (and transitively customers, as merchants still need to make a profit). AMEX has even higher transaction fees, which is why some businesses don't accept it. The situation is now at an idiotic local maximum: if I don't use one of these cashbacks cards, I am losing money paying for my neighbor's air miles, as I don't get a discount anyway. You don't need a "technofix" for that, you need regulations that cap interchange fees like the EU.
- maccard 5y ago
  I don't know who ValuePenguin are, but those rates are definitely misleading. The interchange setup in the US is nuts, but only the highest tier of rewards cards are 3%, when used to purchase travel (see mastercard [0]). The vast majority are 1-1.5% ish. I will admit that this is higher than I expected, but MasterCardaren't taking a 3% cut of every card transaction. > AMEX has even higher transaction fees, which is why some businesses don't accept it. Given the opacity of the fees (or "discounts") as amex calls them, I don't know how to believe this. Lots of retailers in the EU don't accept them, yet amex are bound by the same interchange limits as Visa and Mastercard. How much of this is actually true and how much is "well it was true 30 years ago and I've not questioned it" > You don't need a "technofix" for that, you need regulations that cap interchange fees like the EU. Agreed. And using crypto to limit network fees is a terrible idea. I just had a quick look and the current gas fee for ethereum is $20! [0] https://www.mastercard.us/content/dam/public/mastercardcom/na/us/en/documents/merchant-rates-2021-2022-apr-2021.pdf https://www.mastercard.us/content/dam/public/mastercardcom/n...

hocuspocus 5y ago

Note that the 0.3% cap is on the interchange, i.e. the fee that goes back to the card issuer, it doesn't affect Visa and Mastercard directly. PSPs in the EU/EEA charge around 1% overall, a bit more to small businesses (for instance SumUp), and a bit less to the really big retailers that have more bargaining power.

maccard 5y ago
I'm aware of that, but OP was talking about 3% of his transaction going to visa/mc, not stripe/sumup.

xvello 5y ago

> Where are you located that visa and MasterCard are charging 3%? I am guessing the good old unregulated free market of the US of A: https://www.valuepenguin.com/what-credit-card-processing-fees-costs https://www.valuepenguin.com/what-credit-card-processing-fee... There, banks and credit card companies offer huge perks and cash-back to card holders. That money must come from somewhere, and that's from the transaction fees paid by merchants (and transitively customers, as merchants still need to make a profit). AMEX has even higher transaction fees, which is why some businesses don't accept it. The situation is now at an idiotic local maximum: if I don't use one of these cashbacks cards, I am losing money paying for my neighbor's air miles, as I don't get a discount anyway. You don't need a "technofix" for that, you need regulations that cap interchange fees like the EU.

maccard 5y ago
I don't know who ValuePenguin are, but those rates are definitely misleading. The interchange setup in the US is nuts, but only the highest tier of rewards cards are 3%, when used to purchase travel (see mastercard [0]). The vast majority are 1-1.5% ish. I will admit that this is higher than I expected, but MasterCardaren't taking a 3% cut of every card transaction. > AMEX has even higher transaction fees, which is why some businesses don't accept it. Given the opacity of the fees (or "discounts") as amex calls them, I don't know how to believe this. Lots of retailers in the EU don't accept them, yet amex are bound by the same interchange limits as Visa and Mastercard. How much of this is actually true and how much is "well it was true 30 years ago and I've not questioned it" > You don't need a "technofix" for that, you need regulations that cap interchange fees like the EU. Agreed. And using crypto to limit network fees is a terrible idea. I just had a quick look and the current gas fee for ethereum is $20! [0] https://www.mastercard.us/content/dam/public/mastercardcom/na/us/en/documents/merchant-rates-2021-2022-apr-2021.pdf https://www.mastercard.us/content/dam/public/mastercardcom/n...