4 ms·

Anything to keep the mass from ditching the plastic, cause when that happens, VISA, MC and co are in jeopardy.

saosebastiao 12y ago
The credit card processors do far more than just issue magic pieces of plastic. The plastic itself is probably the least significant aspect of their business model.
- headgasket 12y ago
  The business model relies on a monopoly, an information monopoly. If the mass's interaction at POS is with a software or a hardware that potentially allows id-ing the patron, preferential pricing becomes possible, security is anon issue -- it seriously damages the value of the middleman. So that the secure element(yeah right) that's on your plastic or your phone only communicates with OSes and HW that limits the ID-ing of the cx and provides the strict minimum of info to your POS is the critical part, in my view.
  - saosebastiao 12y ago
    If privacy were really the concern, people would pay with cash. They always have, and always will. It is accepted everywhere, is the definition of liquidity, and is virtually untraceable. At best, in-person swiping of physical credit cards is a compromise that people make that gives away some of that privacy (your card provides your name, and can be used to verify your address) in exchange for something more valuable: 1) near immediate payment resolution 2) fraud protection 3) insurance against bad products and vendors - you can almost always get your money back if something goes wrong 4) credit accounts 5) points/miles/cash-back, at the expense of the vendor
    - headgasket 12y ago
      How many different merchants to do you deal with on a regular basis? What is the risk of fraud or of bad product and or bad vendors when both ends know each other? Why introduce a 3rd party in those transactions that gives back a fraction of its fee to the payer? (5) Instead why not reward repeat business with preferential pricing? (not directly possible but attempted via loyalty programs that cost a lot to deploy) The credit is provided by the issuing bank (4). It can exist independently of the credit card network. And with any electronic means, 1 is pretty much a given. Credit 3rd parties still have a reason d'être if a solution that shortcuts VISA and MC when both ends know each other catches on. A Credit 3rd party is needed as an insurance policy when two unknown parties do a transaction; that insurance is bound to cost more than today given less volume; but it could be efficient if pricing would be market driven instead of diluted in 100-1 day to day transactions. Thanks to the down voters, BTW. Again HN is showing openness to look at things from a totally non conventional angle. I think I'll log off for good. So long, and thanks for all the fish!
otuutti 12y ago
fwiw Visa and MC have both been interested/open in discussions with us and our product is doing exactly that (removing the plastic).

The credit card processors do far more than just issue magic pieces of plastic. The plastic itself is probably the least significant aspect of their business model.

headgasket 12y ago
The business model relies on a monopoly, an information monopoly. If the mass's interaction at POS is with a software or a hardware that potentially allows id-ing the patron, preferential pricing becomes possible, security is anon issue -- it seriously damages the value of the middleman. So that the secure element(yeah right) that's on your plastic or your phone only communicates with OSes and HW that limits the ID-ing of the cx and provides the strict minimum of info to your POS is the critical part, in my view.
- saosebastiao 12y ago
  If privacy were really the concern, people would pay with cash. They always have, and always will. It is accepted everywhere, is the definition of liquidity, and is virtually untraceable. At best, in-person swiping of physical credit cards is a compromise that people make that gives away some of that privacy (your card provides your name, and can be used to verify your address) in exchange for something more valuable: 1) near immediate payment resolution 2) fraud protection 3) insurance against bad products and vendors - you can almost always get your money back if something goes wrong 4) credit accounts 5) points/miles/cash-back, at the expense of the vendor
  - headgasket 12y ago
    How many different merchants to do you deal with on a regular basis? What is the risk of fraud or of bad product and or bad vendors when both ends know each other? Why introduce a 3rd party in those transactions that gives back a fraction of its fee to the payer? (5) Instead why not reward repeat business with preferential pricing? (not directly possible but attempted via loyalty programs that cost a lot to deploy) The credit is provided by the issuing bank (4). It can exist independently of the credit card network. And with any electronic means, 1 is pretty much a given. Credit 3rd parties still have a reason d'être if a solution that shortcuts VISA and MC when both ends know each other catches on. A Credit 3rd party is needed as an insurance policy when two unknown parties do a transaction; that insurance is bound to cost more than today given less volume; but it could be efficient if pricing would be market driven instead of diluted in 100-1 day to day transactions. Thanks to the down voters, BTW. Again HN is showing openness to look at things from a totally non conventional angle. I think I'll log off for good. So long, and thanks for all the fish!

otuutti 12y ago

fwiw Visa and MC have both been interested/open in discussions with us and our product is doing exactly that (removing the plastic).