[gilgamesh3]

IMHO Visa and Mastercard duopoly are way more powerful than other companies like Facebook or Google. In the end, people still need to pay for services and they use credit cards to pay for it. If Mastercard or Visa don't want a service do exist, they can simply block it and then people won't be able to use the service. The recent OnlyFans and PornHub controversies prove my point. OnlyFans was in the verge of banning explicit porn in their plataform.

https://www.protocol.com/policy/onlyfans-visa-mastercard

[steelstraw]

Chamath argued in a recent episode of the All in Podcast that Visa and Mastercard are going to get wrecked soon, as it becomes apparent they are an unnecessary trillion dollar parasite on the economy. They add a 2-3% tax on every transaction and can block people out at will, as you note. But now we increasingly have cheaper alternatives that are also censorship resistant.

[BitwiseFool]

>"But now we increasingly have cheaper alternatives that are also censorship resistant."

I eagerly await them. However, I strongly suspect there is a massive network effect in-place that keeps Visa and Mastercard dominant. So many businesses want to stop taking credit card payments but the loss of business is often way too much. Anecdotally, getting my paycheck through direct-deposit means I almost never carry cash on me anymore. I would hope that business can find a new payment processor but I am still skeptical, as those companies also want a percentage of the transaction through fees.

[ska]

> Visa and Mastercard are going to get wrecked soon, as it becomes apparent they are an unnecessary trillion dollar parasite on the economy.

This is a completely unsupportable view. The rise of CC processing happened because it was manifestly better than the options you had before (every seen a hand-written credit list at a bodega?)

Now you can probably squeeze the price point a little, and argue about if/when newer technology means the same level of service could be provided for less (maybe) but the complexity of what they do is pretty high. Not to mention the reach and reliability.

Lot's of people wave hands about crypo/defi being a solution to this but currently that's at best wishful thinking.

BNPL companies are a real potential threat for them though.

[ummonk]

A 2-3% is tax is a small price to pay for being able to carry out chargebacks against sellers that don't deliver.

Also, pretty sure their cut is more like 1% after you take into account the 2% cashback.

[jonny_eh]

> But now we increasingly have cheaper alternatives that are also censorship resistant

I really hope you're not referring to crypto.

[meepmorp]

> And we increasingly have cheaper alternatives that are also censorship resistant.

Such as?

[supernovae]

2-3% "tax" isn't really a tax, it's a small cost to increase the buying power of people without debt and its a small fee for the recourse action buyers have in shopping protection.

For example, with my costco card I get extended warranty on everything I purchase, fraud protection, buyer protection and I get cash back. If i was a retailer, I'd be super thrilled that people use Costco cards because my products I sell are backed by that cards extended coverage and consumer protections. They file the extended warranty claim with the card carrier, not me. Sure, I can sell junk coverage - which many electronic stores used to do but those were always junk and didn't turn into revenue streams when the cost of selling junk caught up to people refusing to shop there and hating the store/service. (Looking at your Circuit City)

Prior to credit cards, we'd never have a TV, Microwave or computer in every home.

Not saying that I "Love it", but we can't deny the buying power of debt and what that has done for consumers and more importantly retailers over the years.

Interestingly, for many purchases if the bank chooses to charge it as a debit, then you have no recourse and some banks consider debit a cash transaction and charge YOU a transaction fee (non bank cash use) that is much more than 1-3% fee in the end that would be in the product...

I have no idea about censorship resistant... i can use my card to buy porn, legal weed or whatever...

[gogopuppygogo]

The Federal Reserve is working on FedNow to replace FedWire. It will deliver a replacement for Visa/Mastercard in many ways.

[CPLX]

> 2-3% tax on every transaction

What's actually happening is that a ton of that is getting channeled into frequent flier miles and cash back and rewards and so on.

Not all of course, and there's probably room for disruption, but that's relevant.

[yowlingcat]

> They add a 2-3% tax on every transaction

That's incorrect. It is true that merchants generally pay 2.9% to process card transactions. But, the vast majority of that goes to entities outside of the card network.

[mbroncano]

I suspect that is more a feature than a bug, from the regulator POV: instead of chasing and potentially failing to quickly remove some economic actor from the market, it takes at most two phone calls.

Pretending that the public interest if behind any of these actions an important part of the system, but certainly not the initiator.

[xbmcuser]

In the rest of the world specially Asian countries QR code payment or similar systems have started competing with Visa and Mastercard duopoly when it comes to debit card payments at least.

[bradknowles]

With respect, “whataboutism” doesn’t mean that we shouldn’t also solve the problem of Fuckerberg and whatever he’s calling his latest sneeze machine.