Comment by jawns
3 hours ago
One thing I've noticed with the bigger gas station chains near me is a push to have users download their mobile app, set up ACH payments, and use that as their payment method instead of credit cards in exchange for 10 cents off per gallon. From the merchant side of things, they're paying about $0.60 to process the transaction via ACH, versus $2-$2.50 for credit card transactions, per fill-up. So even if they're merely breaking even once the discounts are factored in, they're still disrupting the credit card companies' dominance.
I would not be surprised if rather than continuing to battling it out with the credit card companies to negotiate for lower fees, more and more retailers adapt to the cashless economy by leaning on ACH in lieu of credit cards, especially in market segments where repeat business is common (basically any retailer that has an existing loyalty program).
To put it another way: Sure, litigation is an option, but even if you win the concessions you want, it will leave the credit card companies entrenched. Pushing more customers to pay via non-credit-card methods has the benefit of more immediate financial impact, less reliance on the legal system, and deterioration of the power that led to the anticompetitive behavior in the first place.
QT is doing that ime but reading the app reviews, it seems they will send you straight to collections if any ach withdrawal fails even if the glitch, according to the users, lies with QT. Reading these killed any desire to go through this on my part, even with the "10c off gas" sweetener attached.
I'd be hesitant to give a gas station app ACH access to my checking account. I guess you could open a second account and just transfer enough there to cover your purchases but that's a bit of a nuisance.
I'd be hesitant to give any app any sort of access to my checking account. I would only do so with a second account with just enough there to cover my purchase. While it is a nuisance, the phone is simply too large of an attack vector to consider anything else.
I hope to move to Mercury Bank soon, which allows you to create an unlimited number of checking accounts without additional verification, including for cases just like these. Just need to find another job to afford the fee... ($240/yr)
I’d be more than happy to use a secure, fraud-safe payment system that does not give me airline miles if it meant everything was cheaper to begin with. Part of the problem with CC companies is they do many things that are tightly coupled and are positioned well to profit on them.
The problem is the ‘fraud safety’. Your ‘safety’ is likely to be some else’s inconvenience (or vice-versa), and credit cards are all about ease-of-use. Fraud-related costs are also one of, if not the largest single contributor(s) to payment processing fees.
Seems like payment processing would do well to be a public good instead of a for-profit venture to me.
3 replies →
"a push to have users download their mobile app" This is the blocker for me, every vendor wants you to download a different mobile app.
I had to on the spot download a mobile app to pay to get my car back from valet parking at a really nice hotel the other day. They only accepted payment via the app which they did not disclose before taking the car. I had to stand there for 10 minutes installing the app and setting it up and I will likely never go back to that hotel (becuase of location, not the app).
No idea what would have happened if I just had an old fashioned flip phone
At $7 per gallon, a 3% back card on gas gives 21 cents a gallon in cashback to me. So that’s a pretty hard no.
is it instant ACH?
That's a little crazy, because gas stations. I would probably be OK, if such a deep discount was offered, with setting up ACH to some major chain with reasonable dispute policies, for example Target stores. Actually, Target brands their own credit and debit cards, so they kind of are the creditor already.
But you don't know who owns or operates a gas station. They've all got big brand names, but what's their business model? Who's actually running the transaction? The gas pumps are practically unattended and, highly regulated by Weights and Measures because of the high potential for vendor fraud already. Gas stations are already notorious locales for card-skimmer danger. So, I would be loath to get into an ACH bank dispute with Sri Singh McSikhface.
I already had massive troubles, some of them Visa-related, with local laundries and dry cleaners. They are vicious, fly-by-night, and dishonest. I would not risk the same shitty experiences with gas stations.
The point would have held without the off-the-cuff racial stereotypes…
I’m also wondering if you and I have encountered rather different permutations of these “pay-via-loyalty-app” schemes. In the part of the world where I’ve been spending time, the gas purveyors who I notice pushing the apps are the big, brand-name fuel station networks. The same ones who’ve pushed own-brand payment services to fleet managers for a while.
If you’re worried about card skimmers, wouldn’t you prefer to use the method that routes payment directly through Corporate Fuel Parent, rather than trusting the franchisee with any of your financial information?
You think writing a check to a gas station is an unacceptable security risk?
That's just the way people have paid for gas since they had bank accounts.