4 ms·

I'm not sure it's that high. They probably have AML regulations in multiple countries on their backs, and they are dealing with tons of tiny payments not a few

by comboy 4y ago

I'm not sure it's that high. They probably have AML regulations in multiple countries on their backs, and they are dealing with tons of tiny payments not a few big ones. For each tiny payment there's some chance of a problem occurring which will require support time.

colechristensen 4y ago
Banks take care of an enormous amount of small transactions on credit and debit cards and only charge ~3%, some European countries have fees as low as 0.3%. The high fees of patreon have nothing to do with payment support issues.
- SpicyLemonZest 4y ago
  At least in the US, banks provide quite a bit less payment support. Chargebacks are a big one: with Stripe or something similar, you have to manually respond and pay a $20+ fee every time someone files a chargeback.
  - TedDoesntTalk 4y ago
    You don’t have to manually respond. But then you lose the chargeback dispute by default.
- cuteboy19 4y ago
  In India, the cost of instant payments is exactly zero. Additionally, RuPay cards have a Zero MDR which has really really made Visa and MasterCard angry
  - viraptor 4y ago
    So what do you pay with? Your transaction data? Subscription to other services?
    - cuteboy19 4y ago
      I actually had the privilege of attending a seminar by the NCPI guys and someone did ask this question. The answer is different for different players in the ecosystem. But fundamentally, the actual cost per transaction is so low that it really does not matter. Visa/MasterCard are rent seeking parasites. For the apps like GPay and Amazonpay, yes it is data. But of course there is the reference implementation app that does not do any of that. People just prefer the other apps because they offer good cashbacks. For the banks, it's a service they offer, just like having a website and passbook updation. No customer is going to go to a bank without a website and now the same applies for instant transfer.
      - viraptor 4y ago
        I hope it works out in the long run. I've seen a version of "banks do payments" before and while it started well, other banks started doing their own thing with quality degrading, and merchants needing to support more options. Until we got to the absurdity of "here's a grid of 30 bank icons, try to find yours"...
        cuteboy19 4y ago
        > "here's a grid of 30 bank icons, try to find yours"... UPI exists to solve precisely that problem. It forces everyone to use a common interface. Customers can use any app they want to access the API. They don't depend on the bank for anything except the actual Credits and Debits in your account.
- comboy 4y ago
  Most clients are just marketing. Banks make money with your money. And 99% of stored money comes from 0.1% of their clients. Leverage coming from fractional-reserve [1] is just a part of it but it gives you some idea. If you mean just credit cards, it's much different scale than what we're discussing here and a duopoly which is basically a money printing machine. If somebody has any insight how much money Visa/Mastercard make from banks and institutions vs users I'd love to hear it. But don't forget that apart from a small percentage which goes to CC provider, they also get the most valuable data there is about you as a consumer (and more generally about all consumers worldwide and trends across multitude of dimensions). I'm guessing these companies could easily survive just selling the data. 1. https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking

by comboy 4y ago

colechristensen 4y ago

Banks take care of an enormous amount of small transactions on credit and debit cards and only charge ~3%, some European countries have fees as low as 0.3%. The high fees of patreon have nothing to do with payment support issues.

SpicyLemonZest 4y ago
At least in the US, banks provide quite a bit less payment support. Chargebacks are a big one: with Stripe or something similar, you have to manually respond and pay a $20+ fee every time someone files a chargeback.
- TedDoesntTalk 4y ago
  You don’t have to manually respond. But then you lose the chargeback dispute by default.
cuteboy19 4y ago
In India, the cost of instant payments is exactly zero. Additionally, RuPay cards have a Zero MDR which has really really made Visa and MasterCard angry
- viraptor 4y ago
  So what do you pay with? Your transaction data? Subscription to other services?
  - cuteboy19 4y ago
    I actually had the privilege of attending a seminar by the NCPI guys and someone did ask this question. The answer is different for different players in the ecosystem. But fundamentally, the actual cost per transaction is so low that it really does not matter. Visa/MasterCard are rent seeking parasites. For the apps like GPay and Amazonpay, yes it is data. But of course there is the reference implementation app that does not do any of that. People just prefer the other apps because they offer good cashbacks. For the banks, it's a service they offer, just like having a website and passbook updation. No customer is going to go to a bank without a website and now the same applies for instant transfer.
    - viraptor 4y ago
      I hope it works out in the long run. I've seen a version of "banks do payments" before and while it started well, other banks started doing their own thing with quality degrading, and merchants needing to support more options. Until we got to the absurdity of "here's a grid of 30 bank icons, try to find yours"...
      - cuteboy19 4y ago
        > "here's a grid of 30 bank icons, try to find yours"... UPI exists to solve precisely that problem. It forces everyone to use a common interface. Customers can use any app they want to access the API. They don't depend on the bank for anything except the actual Credits and Debits in your account.
comboy 4y ago
Most clients are just marketing. Banks make money with your money. And 99% of stored money comes from 0.1% of their clients. Leverage coming from fractional-reserve [1] is just a part of it but it gives you some idea. If you mean just credit cards, it's much different scale than what we're discussing here and a duopoly which is basically a money printing machine. If somebody has any insight how much money Visa/Mastercard make from banks and institutions vs users I'd love to hear it. But don't forget that apart from a small percentage which goes to CC provider, they also get the most valuable data there is about you as a consumer (and more generally about all consumers worldwide and trends across multitude of dimensions). I'm guessing these companies could easily survive just selling the data. 1. https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking