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> Imagine if an user of a Visa credit card must be allowed to use the same magnetic stripe on the Mastercard network. Do you support that? How is Apple doing an
by avianlyric 5y ago
> Imagine if an user of a Visa credit card must be allowed to use the same magnetic stripe on the Mastercard network. Do you support that? How is Apple doing anything different?
Erm, the EU has pretty much already done that. Payment networks must support competitors running over their terminals and network for a fair price.
Go lookup up EuroPay, didn’t quite pan out how the EU expected. But if you wanna start a new payment network in the EU, MasterCard must help you out.
- snake_doc 5y agoSome of economists may argue the Visa/Mastercard duopoly in the EU is a collusive monopoly position that hurts merchants and consumers.
- avianlyric 5y agoPerhaps, but they’re basically regulated like a utility at this point. Interchange fees are tightly capped, and about 10d lower than the US and many other parts of the world. There’s no real opportunity for either MasterCard or Visa to rent seek in an effective manner. Compared to the US where interchange is sky high, despite slightly greater competition, the EU has a pretty good deal. Also regs like PSD2 further push/incentivise payment networks and banks to reduce fraud losses further, and thus reduce the costs that are ultimately borne by consumers and merchants.
- danShumway 5y agoI could definitely see that, but I don't think that those economists would be likely to go on to argue that the best way to deal with a collusive duopoly is to make it easier for the duopoly to effectively ban competitors from the market by blocking access to their payment terminals. If you think that a company is a monopoly/duopoly, that's an argument for forcing them to support more interoperability with competitors, not less.