Comment by benoliver999
6 hours ago
Surely the UK can also pull this off given how quick faster payments is. I'm always surprised at how we just stuck with Visa
6 hours ago
Surely the UK can also pull this off given how quick faster payments is. I'm always surprised at how we just stuck with Visa
I think the problem is that merchants hate the card networks and consumers generally like them and there are a lot more consumers than merchants. If you are a politician, which block of voters are you going to side with?
Merchants don't hate the card networks. That's a minority in my experience, who are penny wise and pound foolish.
They like the card networks because they are lured by point schemes, effectively money charged to the merchants and then shared back to cardholders. Consumers would flip in a heartbeat if shops were allowed to offer discounts to those not using credit cards.
I used to by all my PC parts from a shop that had a 5% discount for cash purchases. It was the sort of shop that was just a counter with all the merch hidden in the back. I don't know how they kept the CC companies from knowing but maybe 40% of their business was cash purchases (circa 2019).
> Consumers would flip in a heartbeat if shops were allowed to offer discounts to those not using credit cards.
We must be very different consumers.
Also, many places already do effectively this, they charge a surcharge for using a card.
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CC companies allow this surcharge/discount for CC/cash now. Have for several years. I think it was caused by a class action suit.
It is the difference between Credit and Debit cards.
I could see Debit Cards being replaced by direct transfers.
The issue is what happens if who you pay too does not provide the srvice or just runs off with the money.
Under UK Law the customer can deal with the Credit Card issuer and get their money back with a direct payment it is npot always possible.
For debit cards I think the issue will refund if fraudelent but might take a battle. With direct payments the customer has a much harder job.
Yes, and it exists - its called "pay by bank".
its cheaper but customers lose protection for doing it, and as its illegal (yes, against the law) to offer them a discount for using debit cards, cash, or direct payments they have no reason to.
Yes I know pay by bank – I have used that to pay my plumber. In effect it replaces paying by cheque.
But the problem is that if you use it to pay for a service and do not get the service you can only claim off who you paid and that requires taking them to court while Credit Cards just require phoning up the card provider. Debit cards are between the two.
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I've noticed growing use of similar options in the UK already, like Payit and truelayer (often shown in checkout via "Pay by bank"). Ebay and Whetherspoons are examples of places providing these options.
The issue is in the UK we passed a law that "banned credit card charges", but what it actually did was ban discounts for alternate payment methods, meaning everyone has to pay the credit card fees, even if you pay cash. (this was the effect, you can still offer discounts, but the base CC fee legally needs to be baked in first.)
This will mean, its harder for competing payment services to function. And its easier for the big credit card companies to up the % they charge without the public noticing, or blaming them directly.
It was fascinating watching the media coverage, twisting themselves in knots to miss these points while cheering how we were 'standing up to the big cc companies', it was actually quite cringe-worthy at times.