I hate to point out that we have completely free payment options (way too free for most) that could prevent all of this based on b***** technology. But then again maybe itch would get blackmailed even harder by the currently leading payment companies if they were to adopt b***** payments. So only with huge customer demand for free payments could they switch.
I thought you were going for direct bank to bank operations.
I think these are currently the most practical and promising way to get out of the credit card duopoly's influence. It is more onerous on KYC check, but that sounds like a smaller price than a paid service just not existing at all.
Customer protection isn't supposed to come from private third parties in the first place.
Look at it from this angle: why is VISA or Stripe the arbiter of disputes between you and Netflix ? If Netflix made you pay a fee that is not part of your contract or you didn't initiate, you should be able to retrieve that money without asking a racket business to cover you.
And while banks handle fraud issues, arguably they shouldn't be the one reading your contracts and deciding how to interpret it. Some customer agency or small claims court should be more fitting ?
Perhaps you're in a place where that just wouldn't work, fair enough, but the issue should be on why you don't have these laws or institution, not why there's no private middle-men fixing the deals.
> Some customer agency or small claims court should be more fitting? Perhaps you're in a place where that just wouldn't work, fair enough, but the issue should be on why you don't have these laws or institution, not why there's no private middle-men fixing the deals.
In the US, this is effectively non-existent these days.
Best case, now rare, there isn’t an arbitration clause in the EULA, so you have individuals suing companies in small claims.
The problem there is scale.
A company can screw over a lot more people than people will spend time pushing back against a company. Because fundamentally, a company doesn’t give a shit about maintaining a relationship with an angry customer.
The benefit of using payment intermediaries to run arbitration is that the company does want to continue having a relationship with them and is therefore incentivized to care more about the case than they would otherwise.
Granted, there are a lot of ills from payment processors too! But waving a wand and suggesting bank to bank transfers alone fixes the issue is naive.
I find it interesting to want speed in deciding who should get screwed in a transaction.
There are economic advantages in people giving around their payment information, but the social impacts (the very existence of Visa/Mastercard and their influence on businesses or prices) aren't worth it IMHO.
IMHO people should be responsible of how they handle the keys to their money, and better tools should be given to secure and manage that, instead of a Big Brother like middlemen.
I mean, you don't pay cash at a restaurant with a string stuck to your money so you can pull it back three months after, because arguing with the restaurant feels too inefficient.
> If Netflix made you pay a fee that is not part of your contract or you didn't initiate, you should be able to retrieve that money without asking a racket business to cover you.
Allowing customers to claw back money unilaterally opens the door for customers to make a purchase, receive the product, then fraudulently take their money back.
There needs to be a third party in the middle to determine if a chargeback is fraudulent. Chargeback fraud already exists, and what you're proposing makes the problem significantly worse.
This is an industry where chargebacks don't make sense. You either buy and pay or you don't and if you're on the fence, then don't. The only necessary intermediary is a trustworthy online shop/platform with a reasonable refund policy.
The solution to that is requiring your PIN, 2FA and ML-powered suspicious transaction alerts for each transaction. It's actually not as cumbersome as it sounds and takes less than five seconds at its best; UPI in India has perfected it.
Another reason for chargebacks is fraudulent merchants. If somebody sells me a fake item, I highly doubt they are going to willingly refund me when I complain to them about it.
That should either be handled by a court or customer protection action agency, or by your private insurance (basically like how it works with cash transactions)
Baking it into the payment processing warps the whole situation.
Crypto moves the problem from payment providers like Visa to central exchanges like Coinbase. Until you have a completely decentralized ecosystem built around crypto, you run into trouble when offramping to fiat. If I recall, backpage accepted bitcoin when Visa dropped them, but it was way too much hassle to be useful. If you could pay rent and utilities and buy food using some sufficiently decentralized token, crypto may become a viable alternative.
The principle should be that it shifts the problem to payment providers who can be switched out for other payment providers seamlessly. The providers are motivated to behave ethically because you have the option of going elsewhere.
Paying with crypto is still not very usable but you can still do it directly which limits the degree of extortion that can be applied. I think it will get better as it ceases to be 'interesting' and people develop tools that just work rather than try to revolutionize your life.
The interesting thing about cryptocurrencies is using them directly, i.e. when users have their own wallets under their full control. Then it's magical when you make a transaction to somebody and think that nobody is censoring, filtering, moderating or rejecting it in any way. Oh and no PII either.
crypto has well and truly poisoned its own well here, with the sheer number of scams and fraud on the various platforms. It's also hella expensive as a way to take payments, since you usually have 2x exchange fees as well as the network transaction fees on a payment.
Crypto didn't do that. Investment bros did. Pretty much everything created after 2015 is a scam and hardly related to cryptocurrency at all. Just traditional investment/scam types moving in and adopting the name/language for popularity.
But you're right about the outcome from this. Most people don't know the difference, were only exposed to the post-2015 scams, and just assume all cryptocurrency is a scam.
>So why didn't crypto block or ban them from doing these scams using their technology?
And here we have a neat example of how this site, called "hacker news" of all things, can sometimes take on a absurdly idiotic hive-mind approach to some technology X where brainless hostility combines with laughable ignorance to reject something without knowing the first thing about it, even when the thing is emphatically a practical solution to a widely discussed problem.
UPI in India, Pix in Brazil, Interac in Canada, various iBAN schemes in Europe, WeChat and AliPay in China. Everywhere but the US has good options that aren't the credit card duopoly or the scam / crime filled bitcoin.
These examples aren't quite apples-to-apples. Yes, I can e-transfer money to other people in Canada I know or even pay small businesses for their services. But that only applies to one country. When I buy something on Steam or Itch, I must send money abroad, and the same is true for countless other things. And what options do you have for that besides the Visa/MC duopoly or crypto? I'm not a crypto user, but I see it as the only realistic future way of moving money to buy anything that the holy payment processors deem icky, barring the near-zero chance of them being regulated in the US or a popular competitor suddenly appearing.
Steam collects GST so they've already figured that out.
But your basic thesis is correct, it's not apples-to-apples. Debit vs credit is a significant difference. Another major issue is that while the regulations for any one of the alternatives on my list aren't particularly onerous, I imagine the superset of all the regulations/contracts might well be.
I'm not sure how exactly Steam pays local taxes, be it a Canadian third party that siphons the extra money for them or if they just send each region the tax money, but either way the money is flowing abroad at some point. Then there's individual transactions. If you need to internationally send someone money and the payment processors say no for any reason, you're largely SOL. I guess you can mail cash directly, while that still exists. But my point that you can basically only go either through Visa/MC or through crypto stands, even though I don't particularly love either.
Aren't they already collecting through local entities in the first place and then converting them to dollars? Also, Steam does support local card companies like RuPay in India.
Those aren’t clearing houses, those are fintech services built on top of clearing houses. They still rely on credit card duopoly or ACH reconciliation between banking institutions. Don’t kid yourself.
Not at all, UPI is literally just a platform for direct mobile bank-to-bank payments. No credit cards or duopolies involved, just a public-sector behemoth.
UPI is just fast ACH. It’s still built on top of IMPS, which is regulated by RBI. India’s version of US Treasury. A more mobile and grass roots version of Plaid.
All it takes is for RBI to say “This kind of content isn’t allowed” and you’d have the same effect. Here in the US, we didn’t build an IMPS like system until way too late in the game.
You wouldn't, because the business model and the incentives are different. If anything, free chargebacks make consumers careless and turn them into freeloaders.
Or how about actually elected alternative: government regulating these payment providers not to do this? (At least in countries where elections have total cap for donors per party.)
Both Visa and Mastercard are American companies. What do you think the likelihood is that the US in its current situation regulates them? As for other countries, I'm not even sure they have the leverage when faced with an 'essential' duopoly that everyone already relies on.
> I'm not even sure they have the leverage when faced with an 'essential' duopoly that everyone already relies on.
The fact they are so essential should give the nations all the leverage - "Your service has become too important to the function of our nation, so we are nationalizing your company and making it a public service."
Time to stop being afraid of doing that - if a private company is THAT important to the continuing functioning of your society, then that company has lost their right to be a private for profit business and needs to be nationalized, at least partially to keep them in check and make sure they are following the laws of the nations they operate in.
We, as societies, should have never allowed any corporation to become more powerful than their governments.
Right, that's why the whitepaper is titled "Bitcoin: A Peer-to-Peer Electronic Cash System". The idea is to bring many of cash payments features to the digital world, which are not possible with payment systems with intermediaries: uncensorability (nobody can keep you from transferring cash); non-reversability (no chargebacks, escrow systems are optional); low fees (contentious because BTC decided not to scale on-chain, but that was Satoshi Nakamoto's idea.
If you want a somewhat simple experience you still need to go through the exchanges which could also be coerced into censorship. I guess you can move the coins through multiple wallets but how many people want to jump through those hoops
They aren't free as in beer, which is part of the problem. (The other major part being that the people who build them are in love with deflation, which makes them extremely hard to use as a currency.)
