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> If Visa doesn't like what a website is doing, Visa can walk away Right, which does massive damage to that website as Visa is part of a duopoly with a complet

by nawgz 4y ago

> If Visa doesn't like what a website is doing, Visa can walk away Right, which does massive damage to that website as Visa is part of a duopoly with a complete stranglehold on the market > If I don't agree with Visa's decision, I am free to walk away from Visa Ok, and if Mastercard follows suit, where do you go? The problem with essential services - monetary transmission, in this case - being monopolized by private companies is that your trite claim that "each party can walk away" is actually quite clearly untrue for the consumer in each such situation. Market actors should be free to make their own decisions, but monopoly and cartel situations need regulation to prevent consumer harm, and it's clear what this is.

sandworm101 4y ago
Cash? Paypal? Bitcoin? There may be no other equally-convenient form of card payment, but Visa doesn't have a stranglehold on financial transactions.
- nawgz 4y ago
  > Cash? This has to be intentionally obtuse, we're talking about online payment processors... > Bitcoin? So easy to use, so stable > PayPal Yes, you're right, in the US it's more of a tri-opoly than a duopoly - you'll note globally it's more of a duopoly. But that's pretty far from supporting claims like "Visa doesn't have a stranglehold on financial transactions". Visa and MasterCard usually move in some form of legal tandem from what I've seen, which returns us to the original point: arguing about idealistic "market" conditions in a captured, distinctly not-free market is foolish at best and intentionally misleading in this case.
  - richbell 4y ago
    At the end of the day PayPal, Stripe, Square, etc. are beholden to Visa and MasterCard and not really competitors.
- stickfigure 4y ago
  Visa does indeed have a near-stranglehold on financial transactions, and the reason is that US governments make it nearly impossible to set up a competing financial transaction processing system. It's generally regarded on HN that it would be legally impossible to create Paypal today, and I believe this is accurate. There is a famous series of HN posts from some startup trying to get into this space (sorry, can't remember the details - maybe someone else can fill in). The horrorshow of getting "money transmitter licenses" and working through compliance issues in 50 different states (plus federal) made it impossible. There is not a free market for transaction processing in this country. A small handful of companies are grandfathered into what is effectively a government enforced monopoly. So they need to be treated like the quasi-public utilities they are.

by nawgz 4y ago

sandworm101 4y ago

Cash? Paypal? Bitcoin? There may be no other equally-convenient form of card payment, but Visa doesn't have a stranglehold on financial transactions.

nawgz 4y ago
> Cash? This has to be intentionally obtuse, we're talking about online payment processors... > Bitcoin? So easy to use, so stable > PayPal Yes, you're right, in the US it's more of a tri-opoly than a duopoly - you'll note globally it's more of a duopoly. But that's pretty far from supporting claims like "Visa doesn't have a stranglehold on financial transactions". Visa and MasterCard usually move in some form of legal tandem from what I've seen, which returns us to the original point: arguing about idealistic "market" conditions in a captured, distinctly not-free market is foolish at best and intentionally misleading in this case.
- richbell 4y ago
  At the end of the day PayPal, Stripe, Square, etc. are beholden to Visa and MasterCard and not really competitors.
stickfigure 4y ago
Visa does indeed have a near-stranglehold on financial transactions, and the reason is that US governments make it nearly impossible to set up a competing financial transaction processing system. It's generally regarded on HN that it would be legally impossible to create Paypal today, and I believe this is accurate. There is a famous series of HN posts from some startup trying to get into this space (sorry, can't remember the details - maybe someone else can fill in). The horrorshow of getting "money transmitter licenses" and working through compliance issues in 50 different states (plus federal) made it impossible. There is not a free market for transaction processing in this country. A small handful of companies are grandfathered into what is effectively a government enforced monopoly. So they need to be treated like the quasi-public utilities they are.