4 ms·

Getting rid of payment processors would benefit just about everyone. Only benefit they have is insurance.

by rplnt 12y ago

TylerE 12y ago
For consumers that's a MASSIVE benefit.
- aianus 12y ago
  Not really, the largest single transaction I've ever made on a credit card is maybe $2000 in flight tickets. At ~$30,000 a year in credit card spending I'm throwing that amount away in credit card fees every two and a half years. I'm perfectly capable of and would prefer the option to self-insure, thank you very much.
  - TylerE 12y ago
    Are you really naive enough to think that retailers won't just pocket whatever savings they have?
    - aianus 12y ago
      Retail is not a very high-margin industry, I imagine Walmart, Amazon, Airlines et al would pass on the savings.
  - myhf 12y ago
    Fees? Shouldn't you be getting that amount back in loyalty points?
    - aianus 12y ago
      Loyalty points change the numbers somewhat but the merchant is still paying two or three times more in fees than I'm getting back in points. Ultimately insurance always has a negative expected value for the average consumer. It makes sense to pay the vig to insure against catastrophic events like a car crash or a house fire, but insuring my daily credit card purchases like takeout meals, groceries, and gas is stupid.
- vertex-four 12y ago
  In fact, insurance is a massive benefit for everyone but the biggest retailers - there's few who would shop at smaller retailers after the first couple of times they've been scammed, they'd prefer to stick to the Amazons and the Wal-marts, so the insurance is a necessity. However... bitcoin does allow new insurance providers to pop up - the insurance provider no longer has to be the same entity that holds your cash (your bank) or provides payment processing services. They could experiment with new models - multi-key escrow until service delivered, an "approved store" model where they'll provide insurance on purchases from stores that they've checked out without ever having to touch the money themselves, or more. This could all be cheaper than what your processor + bank combination costs, potentially. The thing is... that's not really good enough for customers. Nobody thinks enough about a few pennies per purchase to pick up a whole new currency.
Perdition 12y ago
You still have to buy Bitcoin. And given its volatility it is something you probably want to do on-demand, so now you have payment processors in the chain again.
s73v3r 12y ago
I have protection from fraudulent purchases when using my credit card. They also give me the ability to reverse a transaction if I am not satisfied. Bitcoin gives me none of this. If I pay someone in BTC for something, and when I receive the item, it's just a box full of rocks, I have no real recourse or ability to get my money back.

Getting rid of payment processors would benefit just about everyone. Only benefit they have is insurance.

by rplnt 12y ago

Getting rid of payment processors would benefit just about everyone. Only benefit they have is insurance.

TylerE 12y ago

For consumers that's a MASSIVE benefit.

aianus 12y ago
Not really, the largest single transaction I've ever made on a credit card is maybe $2000 in flight tickets. At ~$30,000 a year in credit card spending I'm throwing that amount away in credit card fees every two and a half years. I'm perfectly capable of and would prefer the option to self-insure, thank you very much.
- TylerE 12y ago
  Are you really naive enough to think that retailers won't just pocket whatever savings they have?
  - aianus 12y ago
    Retail is not a very high-margin industry, I imagine Walmart, Amazon, Airlines et al would pass on the savings.
- myhf 12y ago
  Fees? Shouldn't you be getting that amount back in loyalty points?
  - aianus 12y ago
    Loyalty points change the numbers somewhat but the merchant is still paying two or three times more in fees than I'm getting back in points. Ultimately insurance always has a negative expected value for the average consumer. It makes sense to pay the vig to insure against catastrophic events like a car crash or a house fire, but insuring my daily credit card purchases like takeout meals, groceries, and gas is stupid.
vertex-four 12y ago
In fact, insurance is a massive benefit for everyone but the biggest retailers - there's few who would shop at smaller retailers after the first couple of times they've been scammed, they'd prefer to stick to the Amazons and the Wal-marts, so the insurance is a necessity. However... bitcoin does allow new insurance providers to pop up - the insurance provider no longer has to be the same entity that holds your cash (your bank) or provides payment processing services. They could experiment with new models - multi-key escrow until service delivered, an "approved store" model where they'll provide insurance on purchases from stores that they've checked out without ever having to touch the money themselves, or more. This could all be cheaper than what your processor + bank combination costs, potentially. The thing is... that's not really good enough for customers. Nobody thinks enough about a few pennies per purchase to pick up a whole new currency.

Perdition 12y ago

You still have to buy Bitcoin. And given its volatility it is something you probably want to do on-demand, so now you have payment processors in the chain again.

s73v3r 12y ago

I have protection from fraudulent purchases when using my credit card. They also give me the ability to reverse a transaction if I am not satisfied. Bitcoin gives me none of this. If I pay someone in BTC for something, and when I receive the item, it's just a box full of rocks, I have no real recourse or ability to get my money back.