3 ms·

If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction with

If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password. At least the others offer the hope that maybe some customers will pay directly from a Stripe/PayPal account, without the high commission and high risk of a Visa/MasterCard network transaction.

chirau 3mo ago
Not true. Visa and Mastercard don't make the bulk of the commission. When a merchant pays a standard 2.9% + $0.30 fee on a credit card transaction the issuing bank gets roughly 1.5-2.5% for interchange, which is the bulk. The processor or acquirer gets anywhere from 0.2-0.5% and the card network gets only about 0.1-0.15. Also, PayPal does not lower a vendor's commission. If they pay with a PayPal cash balance, PayPal still charges the merchant a premium flat rate (often 3.49%) and simply pockets the entire spread. They don't pass the savings down. And consumer's don't have a Stripe account to pay from, Stripe is probably aiming for PayPal wallets via this move.
- sgerenser 3mo ago
  Upvote because AFAIK this is true. Not sure why your comment was downvoted to dead just a few minutes ago.
ThePowerOfFuet 3mo ago
>If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password. 3DS2 is the solution to that problem.
- hakfoo 3mo ago
  3-D Secure has been a fiasco IMO. I can recall when we first tried 3DS in the US and it went over like a lead balloon. Let's jump out of the middle of checkout and go to a page which looks like they're trying to phish your bank account to continue, and by the way, you can just skip it. So customers did, and then merchants followed, except in countries that effectively required it because they cared about fraud. One of the major selling points of 3DS2 was basically "we can guesstimate fraud with magic black-box logic behind the scenes so most of the time the customer is not disrupted." But it's still lipstick on a pig because there are plenty of outs where you don't strictly need 3DS even in "countries that required it", and it's still window dressing around the idea that we're giving merchants an unscoped credential and hoping desperately it doesn't get misused or stolen elsewhere. When we finally decide we don't want to get lapped by India and Brazil in payment tech anymore, I hope the camel-designed-by-committee it spawns is a push-only paradigm. If I want to buy something, let Newegg render a HTML microformat that browsers can detect and turn into a big clicky link to my bank's website/app with a pre-configured outbound transaction. Just as easy for the customer as a stored card, with less risk of abuse/compromise.
  - SkiFire13 3mo ago
    > 3-D Secure has been a fiasco IMO. > I can recall when we first tried 3DS in the US Exactly, it has been a fiasco in the US, but it's working quite well in Europe. > When we finally decide we don't want to get lapped by India and Brazil in payment tech They are indeed ahead, but they still work based on some kind of user authentication that's not a plaintext credit card number. That's the same disruption as 3DS, except normalized and a better executed.
  - account42 3mo ago
    It's also stupid because most people already have a bank app as 2FA so they could just make approve payments there. And this functionality exists or at least existed but I can count the number of times I have seen it on one hand. Instead my bank went back to randomly denying transactions based on questionable heuristics.
    - tupac_speedrap 3mo ago
      In my experience that's how 3DS actually works though, you have 8 minutes to approve the transaction in your bank app and your bank app usually has it's own security to actually access it to accept the transaction
    - jack_pp 3mo ago
      that's how it works in my country, though there are no denies, almost 90% of transactions over 20-30$ will require I go into my bank app and confirm it. rarely a big transaction will go through without 2FA but I've never had a transaction declined outright without first asking me to 2FA from the bank app
  - mcintyre1994 3mo ago
    > Let's jump out of the middle of checkout and go to a page which looks like they're trying to phish your bank account to continue, and by the way, you can just skip it. Any idea why they implemented it like that? In the UK you either get a text from your bank with transaction details and a code to approve it. Or the better ones you just open their app and tap approve.
deleted 3mo ago
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mbesto 3mo ago
> Visa or MasterCard is making the bulk of the commission They are not. Payment facilitators (like Stripe) are. https://images.prismic.io/sacra/30d7bd58-8149-461e-a3c2-8a4a12df66dd_jan-2021-12-07+2.jpg?auto=compress,format https://images.prismic.io/sacra/30d7bd58-8149-461e-a3c2-8a4a...

chirau 3mo ago

Not true. Visa and Mastercard don't make the bulk of the commission. When a merchant pays a standard 2.9% + $0.30 fee on a credit card transaction the issuing bank gets roughly 1.5-2.5% for interchange, which is the bulk. The processor or acquirer gets anywhere from 0.2-0.5% and the card network gets only about 0.1-0.15. Also, PayPal does not lower a vendor's commission. If they pay with a PayPal cash balance, PayPal still charges the merchant a premium flat rate (often 3.49%) and simply pockets the entire spread. They don't pass the savings down. And consumer's don't have a Stripe account to pay from, Stripe is probably aiming for PayPal wallets via this move.

sgerenser 3mo ago
Upvote because AFAIK this is true. Not sure why your comment was downvoted to dead just a few minutes ago.

ThePowerOfFuet 3mo ago

>If it's a card-not-present transaction, Visa or MasterCard is making the bulk of the commission and forcing the vendor to take on the risk of a transaction without a PIN or password. 3DS2 is the solution to that problem.

hakfoo 3mo ago
3-D Secure has been a fiasco IMO. I can recall when we first tried 3DS in the US and it went over like a lead balloon. Let's jump out of the middle of checkout and go to a page which looks like they're trying to phish your bank account to continue, and by the way, you can just skip it. So customers did, and then merchants followed, except in countries that effectively required it because they cared about fraud. One of the major selling points of 3DS2 was basically "we can guesstimate fraud with magic black-box logic behind the scenes so most of the time the customer is not disrupted." But it's still lipstick on a pig because there are plenty of outs where you don't strictly need 3DS even in "countries that required it", and it's still window dressing around the idea that we're giving merchants an unscoped credential and hoping desperately it doesn't get misused or stolen elsewhere. When we finally decide we don't want to get lapped by India and Brazil in payment tech anymore, I hope the camel-designed-by-committee it spawns is a push-only paradigm. If I want to buy something, let Newegg render a HTML microformat that browsers can detect and turn into a big clicky link to my bank's website/app with a pre-configured outbound transaction. Just as easy for the customer as a stored card, with less risk of abuse/compromise.
- SkiFire13 3mo ago
  > 3-D Secure has been a fiasco IMO. > I can recall when we first tried 3DS in the US Exactly, it has been a fiasco in the US, but it's working quite well in Europe. > When we finally decide we don't want to get lapped by India and Brazil in payment tech They are indeed ahead, but they still work based on some kind of user authentication that's not a plaintext credit card number. That's the same disruption as 3DS, except normalized and a better executed.
- account42 3mo ago
  It's also stupid because most people already have a bank app as 2FA so they could just make approve payments there. And this functionality exists or at least existed but I can count the number of times I have seen it on one hand. Instead my bank went back to randomly denying transactions based on questionable heuristics.
  - tupac_speedrap 3mo ago
    In my experience that's how 3DS actually works though, you have 8 minutes to approve the transaction in your bank app and your bank app usually has it's own security to actually access it to accept the transaction
  - jack_pp 3mo ago
    that's how it works in my country, though there are no denies, almost 90% of transactions over 20-30$ will require I go into my bank app and confirm it. rarely a big transaction will go through without 2FA but I've never had a transaction declined outright without first asking me to 2FA from the bank app
- mcintyre1994 3mo ago
  > Let's jump out of the middle of checkout and go to a page which looks like they're trying to phish your bank account to continue, and by the way, you can just skip it. Any idea why they implemented it like that? In the UK you either get a text from your bank with transaction details and a code to approve it. Or the better ones you just open their app and tap approve.

deleted 3mo ago

[deleted]

mbesto 3mo ago

> Visa or MasterCard is making the bulk of the commission They are not. Payment facilitators (like Stripe) are. https://images.prismic.io/sacra/30d7bd58-8149-461e-a3c2-8a4a12df66dd_jan-2021-12-07+2.jpg?auto=compress,format https://images.prismic.io/sacra/30d7bd58-8149-461e-a3c2-8a4a...