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Reading this excellent article has made me decide to stop taking credit cards (or any electronic payments) for my small farm business. The card companies and t

Reading this excellent article has made me decide to stop taking credit cards (or any electronic payments) for my small farm business. The card companies and their online cohorts are bad enough to deal with as a customer, and this story shattered the last of my trust that using these systems is safe as a merchant. I am already losing money on every sale anyway, because my family eats our potential profits (literally). Sales will be cash only from here on out, because these risks are not worth the potential costs.

deleted 4y ago
[deleted]
tlogan 4y ago
Yesterday, I was talking with one guy doing home inspections. He also refuses to accept CC. The main reason is that after deal does not go thru the people who hire them will file a chargeback.
- deleted 4y ago
  [deleted]
- dawnerd 4y ago
  Had to hire two inspectors in a short time and they both were cash or check only. Same reason.
- raverbashing 4y ago
  It would be "fun" if those people that put the chargeback gets sent to collections and a nice entry gets put on their credit report for payment failure I bet the bank providing their mortgage would love to have that information
  - acdha 4y ago
    So much small scale fraud relies keeping the losses below the level where someone is willing to risk getting sued. The kind of people who are doing this would be highly likely to try things which would end up with you needing a lawyer - even drafting a letter, much less showing up in small claims court would cost more.
    - raverbashing 4y ago
      Exactly That's why you counteract with something that is also "cheap" to do (one lawyer letter is expensive, having a template is cheaper. Sending to collections is cheaper)
- rightbyte 4y ago
  How is that chargeback granted? The inspector has documentation for doing his job in the property. Does Mastercard etc not even ask him for some evidence?
  - ZephyrBlu 4y ago
    My understanding is that chargebacks are not fun to deal with even if there is overwhelming proof that it's fraudulent.
  - acdha 4y ago
    I’d imagine it’s similar to what’s described in the article where the cost of fighting it and the extra processing fees cut even further into the profit margin, and if it happens more than once they’ll use it as an excuse to jack up the base rate. Home inspection isn’t like retail sales - almost anyone buying a house can easily pay with cash or check, you’re not a big fraud risk since they’re not getting something they can resell, you can explain the problem in person, and a longer processing time doesn’t matter because you’re not doing a ton of transactions or any where someone expects to get the product in 30 seconds. I’m sure it’s convenient for customers but if you’re the inspector looking at paying 5+% of your revenue you’re definitely going to ask how many customers would walk if you don’t accept a credit card.
- ghaff 4y ago
  Of course, a lot of small time contractors and other service people in the US still primarily operate by check. I suspect that most of the people here from the US who say they never write checks don't own houses.
fragmede 4y ago
Will you still accept debit cards then? Not all digital money systems are the same, and if you find cash-only to be too limiting, it would behoove you to find reasons to accept something digital. PayPal/Venmo/Square/Zelle/other each have their own issues, but they're different from credit cards.
- minutemad 4y ago
  Debit cards will get charged back all the same. Some fraudsters will "lose their card" just to chargeback all charges since they "lost it".
  - withinboredom 4y ago
    Debit cards run as debit cards (ie, not through credit card processors like Visa/Mastercard) are actually really hard to charge back, if at all. They go through different processes than credit cards which are much more favorable to the merchant with lower fees.
    - ChrisMarshallNY 4y ago
      This was why a bunch of retailers tried creating an Apple Pay competitor, based on direct bank access. It withered on the vine.
      - sgerenser 4y ago
        Several major retailers, including WalMart, Kroger (and their dozens of grocery brands like Ralph’s, QFC, Harris Teeter), Lowes and Home Depot still don’t take Apple Pay (or any form of tap to pay). Obnoxious and thought they would have given in by now.
        ChrisMarshallNY 4y ago
        That sounds like the same retailers (I know WalMart was behind it). Wendy's also doesn't take it. I think that CVS used to reject it, but they have been taking it for at least the last couple of years. I use ApplePay for everything. It is starting to become stupid to reject it. Even the smallest mom-and-pop places I go, now take ApplePay. It's built into the processors. I think they have to consciously turn it off. Last time I got a haircut, I used it. They didn't even know they took it.
seibelj 4y ago
Cryptocurrencies are like digital cash - one way payments that can’t be reversed. You can accept stablecoins on cheaper networks. Check out BitPay or Square for retail.
- Gigachad 4y ago
  The only payment system with all the downsides of cash while being even less convenient to deal with.
- alpaca128 4y ago
  So far "stablecoins" have to be proven to be anything but stable. And they are not like digital cash as every single transaction is public. Also I'm not sure getting rid of chargebacks completely makes sense - there's a good reason they were introduced in the first place.
- mnd999 4y ago
  There’s always one.
gtowey 4y ago
It feels that way because the credit card companies have never really cared about merchants. Thier customers are the cardholders. They create demand for convenience and therefore the merchants are unwilling hostages to the credit card companies, who can abuse them at their leisure.
- briHass 4y ago
  To be fair, it's mostly a mutually beneficial relationship. There are studies that show CC users tend to spend more at merchants than those that use cash. This logically makes sense, because you may not have enough cash on hand and/or the feel of watching a limited amount of paper money leaving your pocket is different from swiping a chunk of plastic. For online merchants, CCs are the only thing that allow most of them to stay in business. For something where the transaction was irreversible (mailing cash, bitcoin), as a consumer, I would almost never take a chance on ordering from an online merchant that wasn't large and established. That's not to say that the CC companies don't abuse their position. However, most/many businesses have 'done the math' and realized the pros outweigh the cons.
minutemad 4y ago
Chip readers have liability shift. We did an event, and the fraudsters all had "sorry the chip doesn't work, can you swipe it or type it in?" cards. We had zero chargebacks.
- sgerenser 4y ago
  This only protects you from the most egregious form of fraud, where the actual card is cloned/stolen. Using a chip card doesn’t prevent the customer from filing a chargeback for a “failure to deliver” or defective product claim.
  - twarnp 4y ago
    Yes, but fake cards were such a problem it moved the entire card industry to chips. And also, if the friendly fraudster claims fraud or that it wasn't them, the shift stands. I'd also argue that friendly fraud is just as if not more egregious than fraud fraud.
hnburnsy 4y ago
don't banks has cash depositing fees for business accounts and aren't there other cash risks like counterfeits, theft, and leakage?
namibj 4y ago
If only the US had something as convenient and normal as SEPA Push, which recently-ish got extended with SEPA Instant (takes ~10 seconds for the payment to go through/finalize; charge backs are not a thing (unless the bank messed up)). And even normal SEPA Push doesn't have money-claw-back, the charge back process for that after the money has reached the recipient (usually next bank day) starts with asking for the money back and escalates into a lawsuit if the recipient doesn't give in.
- Xylakant 4y ago
  The problem with sepa push is that now the buyer needs to transfer the money explicitly, either before or after the purchase. Either the buyer needs to trust the merchant or the other way around - and on top you can’t make the financial transaction happen when the goods are shipped.
  - Tijdreiziger 4y ago
    > Either the buyer needs to trust the merchant or the other way around - and on top you can’t make the financial transaction happen when the goods are shipped. That’s exactly how iDEAL works, which handles 65% of e-commerce volume in the Netherlands (vs. 13% credit cards). https://www.thuiswinkel.org/media/w1uapsyz/infographic_thuiswinkel_markt_monitor_2021_q3_en.pdf https://www.thuiswinkel.org/media/w1uapsyz/infographic_thuis...
sireat 4y ago
Long time ago I learned that some people will use CC chargeback as a license to steal. Circa 1999 I ran a small retail anime shop. I also had a mail order catalogue and was one of the first to do ecommerce for anime as well. After a pleasant 20 minute call a customer bought a Gundam kit. It was around $100 the most expensive one in my shop. I was shocked to receive a chargeback request 40 days later. Puzzled I called the contact and the very same person claimed that their kid placed an order. Per the CC merchant rules I had to grant the chargeback request and ask for the kit back. I never got the kit.

deleted 4y ago

[deleted]

tlogan 4y ago

Yesterday, I was talking with one guy doing home inspections. He also refuses to accept CC. The main reason is that after deal does not go thru the people who hire them will file a chargeback.

deleted 4y ago
[deleted]
dawnerd 4y ago
Had to hire two inspectors in a short time and they both were cash or check only. Same reason.
raverbashing 4y ago
It would be "fun" if those people that put the chargeback gets sent to collections and a nice entry gets put on their credit report for payment failure I bet the bank providing their mortgage would love to have that information
- acdha 4y ago
  So much small scale fraud relies keeping the losses below the level where someone is willing to risk getting sued. The kind of people who are doing this would be highly likely to try things which would end up with you needing a lawyer - even drafting a letter, much less showing up in small claims court would cost more.
  - raverbashing 4y ago
    Exactly That's why you counteract with something that is also "cheap" to do (one lawyer letter is expensive, having a template is cheaper. Sending to collections is cheaper)
rightbyte 4y ago
How is that chargeback granted? The inspector has documentation for doing his job in the property. Does Mastercard etc not even ask him for some evidence?
- ZephyrBlu 4y ago
  My understanding is that chargebacks are not fun to deal with even if there is overwhelming proof that it's fraudulent.
- acdha 4y ago
  I’d imagine it’s similar to what’s described in the article where the cost of fighting it and the extra processing fees cut even further into the profit margin, and if it happens more than once they’ll use it as an excuse to jack up the base rate. Home inspection isn’t like retail sales - almost anyone buying a house can easily pay with cash or check, you’re not a big fraud risk since they’re not getting something they can resell, you can explain the problem in person, and a longer processing time doesn’t matter because you’re not doing a ton of transactions or any where someone expects to get the product in 30 seconds. I’m sure it’s convenient for customers but if you’re the inspector looking at paying 5+% of your revenue you’re definitely going to ask how many customers would walk if you don’t accept a credit card.
ghaff 4y ago
Of course, a lot of small time contractors and other service people in the US still primarily operate by check. I suspect that most of the people here from the US who say they never write checks don't own houses.

fragmede 4y ago

Will you still accept debit cards then? Not all digital money systems are the same, and if you find cash-only to be too limiting, it would behoove you to find reasons to accept something digital. PayPal/Venmo/Square/Zelle/other each have their own issues, but they're different from credit cards.

minutemad 4y ago
Debit cards will get charged back all the same. Some fraudsters will "lose their card" just to chargeback all charges since they "lost it".
- withinboredom 4y ago
  Debit cards run as debit cards (ie, not through credit card processors like Visa/Mastercard) are actually really hard to charge back, if at all. They go through different processes than credit cards which are much more favorable to the merchant with lower fees.
  - ChrisMarshallNY 4y ago
    This was why a bunch of retailers tried creating an Apple Pay competitor, based on direct bank access. It withered on the vine.
    - sgerenser 4y ago
      Several major retailers, including WalMart, Kroger (and their dozens of grocery brands like Ralph’s, QFC, Harris Teeter), Lowes and Home Depot still don’t take Apple Pay (or any form of tap to pay). Obnoxious and thought they would have given in by now.
      - ChrisMarshallNY 4y ago
        That sounds like the same retailers (I know WalMart was behind it). Wendy's also doesn't take it. I think that CVS used to reject it, but they have been taking it for at least the last couple of years. I use ApplePay for everything. It is starting to become stupid to reject it. Even the smallest mom-and-pop places I go, now take ApplePay. It's built into the processors. I think they have to consciously turn it off. Last time I got a haircut, I used it. They didn't even know they took it.

seibelj 4y ago

Cryptocurrencies are like digital cash - one way payments that can’t be reversed. You can accept stablecoins on cheaper networks. Check out BitPay or Square for retail.

Gigachad 4y ago
The only payment system with all the downsides of cash while being even less convenient to deal with.
alpaca128 4y ago
So far "stablecoins" have to be proven to be anything but stable. And they are not like digital cash as every single transaction is public. Also I'm not sure getting rid of chargebacks completely makes sense - there's a good reason they were introduced in the first place.
mnd999 4y ago
There’s always one.

gtowey 4y ago

It feels that way because the credit card companies have never really cared about merchants. Thier customers are the cardholders. They create demand for convenience and therefore the merchants are unwilling hostages to the credit card companies, who can abuse them at their leisure.

briHass 4y ago
To be fair, it's mostly a mutually beneficial relationship. There are studies that show CC users tend to spend more at merchants than those that use cash. This logically makes sense, because you may not have enough cash on hand and/or the feel of watching a limited amount of paper money leaving your pocket is different from swiping a chunk of plastic. For online merchants, CCs are the only thing that allow most of them to stay in business. For something where the transaction was irreversible (mailing cash, bitcoin), as a consumer, I would almost never take a chance on ordering from an online merchant that wasn't large and established. That's not to say that the CC companies don't abuse their position. However, most/many businesses have 'done the math' and realized the pros outweigh the cons.

minutemad 4y ago

Chip readers have liability shift. We did an event, and the fraudsters all had "sorry the chip doesn't work, can you swipe it or type it in?" cards. We had zero chargebacks.

sgerenser 4y ago
This only protects you from the most egregious form of fraud, where the actual card is cloned/stolen. Using a chip card doesn’t prevent the customer from filing a chargeback for a “failure to deliver” or defective product claim.
- twarnp 4y ago
  Yes, but fake cards were such a problem it moved the entire card industry to chips. And also, if the friendly fraudster claims fraud or that it wasn't them, the shift stands. I'd also argue that friendly fraud is just as if not more egregious than fraud fraud.

hnburnsy 4y ago

don't banks has cash depositing fees for business accounts and aren't there other cash risks like counterfeits, theft, and leakage?

namibj 4y ago

If only the US had something as convenient and normal as SEPA Push, which recently-ish got extended with SEPA Instant (takes ~10 seconds for the payment to go through/finalize; charge backs are not a thing (unless the bank messed up)). And even normal SEPA Push doesn't have money-claw-back, the charge back process for that after the money has reached the recipient (usually next bank day) starts with asking for the money back and escalates into a lawsuit if the recipient doesn't give in.

Xylakant 4y ago
The problem with sepa push is that now the buyer needs to transfer the money explicitly, either before or after the purchase. Either the buyer needs to trust the merchant or the other way around - and on top you can’t make the financial transaction happen when the goods are shipped.
- Tijdreiziger 4y ago
  > Either the buyer needs to trust the merchant or the other way around - and on top you can’t make the financial transaction happen when the goods are shipped. That’s exactly how iDEAL works, which handles 65% of e-commerce volume in the Netherlands (vs. 13% credit cards). https://www.thuiswinkel.org/media/w1uapsyz/infographic_thuiswinkel_markt_monitor_2021_q3_en.pdf https://www.thuiswinkel.org/media/w1uapsyz/infographic_thuis...

sireat 4y ago

Long time ago I learned that some people will use CC chargeback as a license to steal. Circa 1999 I ran a small retail anime shop. I also had a mail order catalogue and was one of the first to do ecommerce for anime as well. After a pleasant 20 minute call a customer bought a Gundam kit. It was around $100 the most expensive one in my shop. I was shocked to receive a chargeback request 40 days later. Puzzled I called the contact and the very same person claimed that their kid placed an order. Per the CC merchant rules I had to grant the chargeback request and ask for the kit back. I never got the kit.