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Yeah you're right, sorry I got my wires a bit crossed with companies that offer credit cards as opposed to the payment networks themselves. That doesn't change

Yeah you're right, sorry I got my wires a bit crossed with companies that offer credit cards as opposed to the payment networks themselves. That doesn't change the thrust of my argument, that middlemen will end up eating whatever efficiencies that FedNow opens up. (Sorry if this sounds flippant. I don't want it to be. I think publicly admitting to being wrong is important on this site, even though very few people do it.)

raw_anon_1111 1y ago
You’re still leaving out a few things 1. International travel - I can (and have) used Visa and MC cards world wide. My Amex cards not so much. They aren’t accepted widely internationally - except strangely enough in the UK when we went. 2. Fraud protection/mis billing - the last thing I want is every random company having a settled payment without my being able to dispute it with the credit card company. While the dispute is happening, it’s not my money being held up. 3. Subscriptions - subscriptions are hard enough to cancel. At least I can easily cancel a credit card 4. Credit card holds - right now, if you rent a car or stay in a hotel for example, they put a hold on your credit card. They can do the same with a debit card. But that’s your money on hold and inaccessible. 5. Related to #4, once you put a credit card on file in those cases, they actually can charge you whatever they want - damages, etc. Do you really want them having direct access to your bank account?
- Karrot_Kream 1y ago
  FedNow is a push protocol, like crypto and most other bank transfer methods. The account holder needs to specifically approve moving funds over. 1. Yes unless FedNow can interface with other bank interchange standards, I'm not sure where this will end up. 2. Exception resolution is a part of FedNow [1]. My guess is banks will have their own layer atop the resolution layer discussed. I suspect this will be a middleman layer. 3. FedNow is a push protocol, like crypto. Banks would have to offer recurring payment functionality atop FedNow. 4. Yes this will probably turn into some form of deposit like what happens with a debit card. 5. Again FedNow is a push protocol it's not a pull protocol. It allows for Request For Payment requests but nothing can directly debit from your bank account.
  - raw_anon_1111 1y ago
    2. Exception resolution happens now with debit cards. The issue is still while the dispute is taking place, you don’t have access to your money. With a credit card, that’s not the case. 3. And how does that work in cases where you have a deferred payment? For instance merchants aren’t allowed to charge you for a product until it ships. 4. That’s a very bad thing. I live in a hotel [1] I see international travelers especially who may not have credit cards and the hotel puts a large hold on their cash (debit card) and they can’t use it while they are here. Even after they realize it and the manager authorizes the hold to be released as a courtesy, they still don’t have immediate access to their cash. 5. The bank is not going to ask you every time you send a payment through just like they don’t now when you use your credit card [1] I live in a unit of a condotel. I own the condo unit like anyone else owns a condo. The difference is that most people rent them out and it’s managed by the hotel property manager. When someone stays in your unit, you split the income with the property manager. Most use it as a vacation property/second home https://www.investopedia.com/terms/c/condotel.asp https://www.investopedia.com/terms/c/condotel.asp
    - Karrot_Kream 1y ago
      Cool, you think credit cards have benefits that FedNow won't fix. The question is, when they're not making fees from merchants what it will take to offer these products.
      - raw_anon_1111 1y ago
        It’s not a question of them not making fees. No one is proposing that Visa and Mastercard can’t charge merchants. The EU caps merchant fees and Visa and MC are still widely accepted. I know in the UK at least interest charges are much higher since the banks make less in fees - yes part of the transaction fee goes to the bank.

raw_anon_1111 1y ago

You’re still leaving out a few things 1. International travel - I can (and have) used Visa and MC cards world wide. My Amex cards not so much. They aren’t accepted widely internationally - except strangely enough in the UK when we went. 2. Fraud protection/mis billing - the last thing I want is every random company having a settled payment without my being able to dispute it with the credit card company. While the dispute is happening, it’s not my money being held up. 3. Subscriptions - subscriptions are hard enough to cancel. At least I can easily cancel a credit card 4. Credit card holds - right now, if you rent a car or stay in a hotel for example, they put a hold on your credit card. They can do the same with a debit card. But that’s your money on hold and inaccessible. 5. Related to #4, once you put a credit card on file in those cases, they actually can charge you whatever they want - damages, etc. Do you really want them having direct access to your bank account?

Karrot_Kream 1y ago
FedNow is a push protocol, like crypto and most other bank transfer methods. The account holder needs to specifically approve moving funds over. 1. Yes unless FedNow can interface with other bank interchange standards, I'm not sure where this will end up. 2. Exception resolution is a part of FedNow [1]. My guess is banks will have their own layer atop the resolution layer discussed. I suspect this will be a middleman layer. 3. FedNow is a push protocol, like crypto. Banks would have to offer recurring payment functionality atop FedNow. 4. Yes this will probably turn into some form of deposit like what happens with a debit card. 5. Again FedNow is a push protocol it's not a pull protocol. It allows for Request For Payment requests but nothing can directly debit from your bank account.
- raw_anon_1111 1y ago
  2. Exception resolution happens now with debit cards. The issue is still while the dispute is taking place, you don’t have access to your money. With a credit card, that’s not the case. 3. And how does that work in cases where you have a deferred payment? For instance merchants aren’t allowed to charge you for a product until it ships. 4. That’s a very bad thing. I live in a hotel [1] I see international travelers especially who may not have credit cards and the hotel puts a large hold on their cash (debit card) and they can’t use it while they are here. Even after they realize it and the manager authorizes the hold to be released as a courtesy, they still don’t have immediate access to their cash. 5. The bank is not going to ask you every time you send a payment through just like they don’t now when you use your credit card [1] I live in a unit of a condotel. I own the condo unit like anyone else owns a condo. The difference is that most people rent them out and it’s managed by the hotel property manager. When someone stays in your unit, you split the income with the property manager. Most use it as a vacation property/second home https://www.investopedia.com/terms/c/condotel.asp https://www.investopedia.com/terms/c/condotel.asp
  - Karrot_Kream 1y ago
    Cool, you think credit cards have benefits that FedNow won't fix. The question is, when they're not making fees from merchants what it will take to offer these products.
    - raw_anon_1111 1y ago
      It’s not a question of them not making fees. No one is proposing that Visa and Mastercard can’t charge merchants. The EU caps merchant fees and Visa and MC are still widely accepted. I know in the UK at least interest charges are much higher since the banks make less in fees - yes part of the transaction fee goes to the bank.