That incident was the first time I've ever taken the need for alternative payment processors very seriously.
example: https://www.eff.org/deeplinks/2015/07/caving-government-pres...
Apple will be piggybacking off of MasterCard's network.
I’m not into the kink which caused it (and I won’t repeat it here) but that left a bad taste in my mouth. IMO, people should be free to discuss what they’re into, even when it’s something much more harmful than the kink involved.
1: So that's what? Anything from deep charcoal black to a subtle off-white?
(I work in payments)
AML = Anti-Money Laundering
(for those that are not in the industry :-))
So I went and looked up their payment options. And sure enough, they have a page on that. Which has the following notice:
"In order to stay compliant with our strategic credit card processing partners' policies and due to recently tightened regulations on the cryptocurrency circulation for the US-based companies, we are going to halt all support for cryptocurrency payments on this site for the time being."
What is this all about? Are they saying that payment processors will refuse to work with organizations that accept cryptocurrency? But then how e.g. Coinbase works with credit cards?
Cryptocurrencies accomplish nothing that wasn't already possible before, usually faster, cheaper and safer. Just because someone uses an alternative doesn't mean it's solving a problem, and in this case it's just creating more issues.
Generally there seems to be lots of people who don't use cryptocurrencies and think that they don't solve any problems - OK whatever, don't use them, but there are loads of people using cryptocurrencies for whatever and your opinions are not objective measure on their value.
Bitcoin allows people in Venezuela to avoid wealth confiscation on the borders, either when they are running away or when they are sending money back home to family.
Bitcoin allows people in Iran to transact with outer world.
Bitcoin allows people in India to keep their wealth in face of demonetization.
There are many problems that Bitcoin solves for real people and real companies every day.
Just because you aren't one of them, doesn't mean they don't exists.
Postal money orders already exists, and are exactly as expensive and inconvenient as you would expect.
The actual problem is KYC laws that require payment processors to do the job of the police and refuse service to customers under purposely vague corporate policies without due process, instead of having the police do that job and only have payment processing service denied with a court order and an opportunity to contest it under the law.
What is awful is that I expect it to be inconvenient and awful in the US because there is this idea that anything the government does will inevitably be bad and then there are multiple political parties that try their hardest to make that idea come true when they get elected.
There's no reason for the system to not work in the US other than people trying to sabotage it to the detriment of large parts of the population so their personal tax burden is lower since they don't believe they ever will need the service.
The EU in general doesn't provide government services, the UK does, France does.
When you're already the size of a state, there are basically no more economies of scale to be had by doing something at the size of a union of states. Your fixed costs are already being amortized over something like a million people or more, so the variable costs already dominate and spreading the fixed costs over even more people is past the point of diminishing returns.
But it's not past the point of expanding overhead. So suppose you want to do this in the US -- have the Post Office compete with Mastercard. You propose the bill.
The banks hate it because it's them you're competing with, they have billions of dollars, but more importantly they're a major industry in some states (e.g. New York) which have large numbers of legislators. So they not only use those votes against your bill, they trade their legislators' votes on other bills to get more votes against your bill. Moreover, their legislators are the ones who care most about things like finance, so guess who is on the finance committee.
Then you have states like Virginia where the major industry is defense. They want to destroy privacy protections, because you can't get a lucrative government contract for hoovering up and data mining financial data if you're not allowed to hoover up and data mine financial data. Guess who is on the committees related to that sort of thing. And New York is all for that -- data mining financial data for private purposes is lucrative too, and that amendment also makes it harder to pass the bill they don't like.
Then you have states where the government itself is a major employer, and what they want is more government jobs for their people. So they don't want your program to be efficient, they want it to be labor intensive, which is the opposite. But then it costs more, charges higher fees, requires the users to fill out more forms to use it etc. You may also see private companies looking for the same thing, because they then sell a solution to it, as with Intuit opposing tax simplification.
And so it goes down the line, at each stage making the program worse and harder to pass, until it either dies in committee somewhere or gets passed as some horrifying abomination that makes things worse rather than better.
This isn't some individual proposing to make the bill worse on purpose to demonstrate the ineffectiveness of government, it's a structural issue that produces that outcome systemically.
Now you expect I'm going to suggest having the individual states do it. There are some states that aren't full of big banks or spooks or government bureaucrats, all we need is for one of them to do it. Which would work if they weren't subject to the same problematic federal laws as private enterprise is, created by the same problematic process, which is the reason the market isn't already taking care of this.
In order for the states to do things better, first the feds would have to stop standing on their feet.
Imagine if the post office was getting transaction fees instead of banks.
Since then I've seen post office banking as a way for getting poorer people out from under the thumb of exploitative banks, credit card companies, and check cashing places. Consider as well why should the government give a cut of EBT's cards and unemployment transactions.
Patreon has also banned various leftist sites for things like doxxing and posting instructions on how to commit terrorism, but that doesn't get as much attention for some reason.
https://twitter.com/realsexycyborg/status/107369726493205299...
> I am not alt right, I am not a nazi. I've been on @SubscribeStar since @Vice terminated my @Patreon account in May. I haven't even recovered from that hit to my income. I am tired of being acceptable collateral damage in your culture wars. You sacrifice your livelihood- not mine.
But all that being said, it's all irrelevant. Let's say he said the n-word maliciously and was a racist, is it the role of MasterCard to prevent that person from being able to pay for a burrito? To get a paycheck from their legal employment? Why can't the expectation be that MasterCard is neutral up until the point of legality? There is a really bad authoritarian trend on the left wing to go after absolutely every neutral cog in the machine. If Reddit doesn't ban /r/The_Donald, Reddit is right wing. If Twitter doesn't ban TERFs, Twitter is right wing. Now payments? Are we going to get mad at the government for letting Been Shapiro drive on their neutral roads?
Outside of a standard set of specific reasons for which it is agreed to be illegal to refuse business (race, sex, orientation etc..), no business is supposed to be able to be compelled -by the government- to associate or transact with another. Instead, boycotts are used by the public themselves (rather than via government strongarming) or by company-to-company action to persuade companies to adjust their behaviour to meet expectations of what is ethically appropriate.
In arrangement, the expectation is not that companies are 'neutral' but that they are sufficiently moderated by public will. This freedom not-to-transact is what allows things such as boycotts of Apartheid South Africa, boycotts of companies that abuse their workers or run sweatshops etc.
There are plenty of ways to rearrange things outside of a Capitalist model, but once you decide to have Capitalism but 'prevent boycotting on political grounds' you're basically suggesting that Capitalism ought to be stripped of one of its extremely few mechanisms for ethical feedback. The implications of that ought to scare you.
What I'm asking is if we as a public really want our payment processors to be making these moral judgements? That doesn't mean I think they should be compelled to do anything, but I certainly think it's cause for concern, and call for an alternative that IS willing to behave as a neutral party. I don't want the noise of what is effectively a pipe to be making arbitrary political judgements when deciding what is allowed to pass through.
Now, publicly funded banks, that's a different question. I absolutely expect neutrality within what is legal from our government institutions.
If this action was completely unprompted, sure, but I think we're talking about payment processors choosing not to associate with people who have already been the subject of boycotts on their previous platform.
A better example would be WikiLeaks which enjoyed a fair amount of public support at the time Visa etc declined to process their payments, as we have reasons to suspect that the pressure on Visa to do this may have been from the U.S. Government.
By contrast, there have already been numerous public protests against people hosted on the SubscribeStar platform.
Apparently we do, otherwise they wouldn’t be doing it.
I'm pretty sure that if you're in position of quasi-monopoly, it should be illegal
See: AT&T after "we" did, Microsoft after "we" didn't.
This is the big problem with both the massive scale of certain businesses, their extensive interweaving with government, and of course monopolization.
For left leaning people it takes doxxing and instructions on how to commit acts of mass violence to get banned.
For the opposite ends of the political spectrum people have been banned for months-old videos - not even on a channel that the banned person runs - in which someone uses a swear word to tell the alt-right that they "are acting like n_____s" (which I interpreted as a deliberate word choice to emphasize irony that the alt-right is behaving how they often portray and see African Americans. Sargon's explanation is roughly similar). Meanwhile there are plenty of people who use the same slur regularly, some even in the usernames of their social media profiles. There is zero doubt in my mind that Patreon decided to ban Sargon on the basis of his political views first, then searched for something to justify the ban.
These are hardly the same situations.
It doesnt take that. But the far-left rarely insults people with racial slurs.
No, they prefer to use words like nazi, facist *phobe, which most likely won't get anyone banned, expect the target of those insults
Its just that coorporations are far more scared of beeing associated with the right, than the left.
Legally speaking you're not allowed to insult anyone, wether as a n-word, nor as a nazi
This is absolutely false, at least in the US where Patreon is based. Out of curiosity where did you get the idea that insults are illegal (assuming you're talking about the Unites States)?
Calling someone a nazi when you cannot proof that they do indeed follow that ideology would also be slander/libel.
Someone tried to sue for calling someone a Nazi but lost [1]. In this case the defendant claimed to have been presenting a hypothetical. I have not been able to find a successful defamation case due to someone being called a Nazi in the US. Not to mention it wouldn't affect calling a black person a n____r because such a statement is not factually incorrect (as the slur is a derogatory term for a black person).
1. https://www.google.com/amp/s/www.thewrap.com/james-woods-bea...
We really need something better.
Their profit motive might save them. Or it could be a disaster, who knows. My guess is that Goldman would trade on the aggregate data
And then there's this, and a dozen other stories about Goldman Sachs deceiving its clients in the past.
https://www.washingtonpost.com/opinions/goldman-sachss-long-...
Typically it comes up in places where there's a question of whether the bank is responsible getting their client the best possible price in a transaction or whether the bank is acting as an arms-length counterparty who happens to be taking the other side of the transaction. It also depends on the sophistication of the client and whether it's a transaction where the client should expect Goldman to be bullshitting them.
Goldman acting as a bank for the Apple credit card is completely different from Goldman acting as the counterparty in a large FX hedge or bond deal.
Not that I like defending GS
It's hard to argue that Apple can keeps Goldman Sachs on a leash. GS can't get a worse reputation that it already has, shaming them is worthless.
That said, if the data is available in your iCloud backup in a form that can be read by other devices, Apple can presumably extract that data under subpoena. If it's in your iCloud backup but encrypted with a per-device key (like your non-iCloud keychain entries), Apple cannot extract that because decrypting the backup (which they can do) isn't sufficient to decrypt this per-device-encrypted data.
All that said, if the government wants to know your spending history, it would be simpler just to subpoena Goldman Sachs.
Source? I’m pretty sure the legal system does allow that.
I don't have a direct citation for you, besides having seen this spoken about before, but a simple thought exercise should prove it: If the government could compel that sort of thing, then we wouldn't have end-to-end encrypted chat (including iMessage) and the government would have already compelled Apple to give the government a backdoor into iPhones.
The FBI took a different view in a recent court case referencing the All Writs act of 1789 https://en.wikipedia.org/wiki/FBI%E2%80%93Apple_encryption_d... but dropped it when they unlocked the device by other means., and the issue hasn't really made it through the court system, so it's unclear what the law requires.
Until a federal case gets to the appeals court level it basically won't establish any binding precedent in other cases under stare decisis.
Australia's does now.
Altering the OS to install a backdoor is a much different beast. It's non-optional, fundamentally weakens the security of the entire OS, and affects all customers everywhere, not just Australian citizens.
Also, if Apple did withdraw from Australia, any Australian citizen who wished to use an iPhone could still acquire one from overseas (though this is admittedly a fair amount of effort) and they'd continue to have a secure computing experience.
https://www.doctorofcredit.com/everything-you-ever-wanted-to...
Essentially, in this case, the underlying bank (Goldman Sachs) handles all the finances and the partner (Apple) lends their name/brand and receives a small kickback on card activities.
It does seem like a lot of work and potential risk if the sole purpose is to increase user dependency on the Apple ecosystem.
Apple has been very focused on not being a big-data company. Any sort of back-end shenanigans would be so damaging to the brand of information safety that they have been building as to be unworth any potential profit.
Roughly $50B are spent on App Store, and even more with growing number of Subscription along with other Apple Credit Card usage. That is a potential of $100B+ transaction volume.
It will likely be another entry point for Apple Cash, sending and receiving money from friends.
Once they have a foothold in the finance sector they can start financing their own devices and capture that revenue, instead of letting it slip to third parties.
This makes incredible sense. Lots of large companies have financing services that are very profitable. Finance is one place where it's much easier to enter than self driving cars.
Now I'm a bit sad I don't own any apple stocks.
With this game plan they can increase their leverage in the consumer market enormously.
Usually a percentage of each transaction and/or flat fee per cardholder or signup and/or a percentage of fees and interest paid. The exact details on these agreements are rarely published.
See here:
https://www.doctorofcredit.com/everything-you-ever-wanted-to...
Previously with other cards, using Apple Pay is just a matter of convenience for the customer. With the Apple Card, it's a matter of getting more cash back, so consumers are now financially motivated to prefer vendors that support Apple Pay.
You're misunderstanding how card networks work a little bit here. This is a credit card, not a payment processing service. Two different sides of the network. "Deplatforming" refers to getting kicked off a given payment processor, which is an entity that gives a merchant access to a card network (in this case Mastercard).
Perhaps issuers like Goldman Sachs could start banning their customers from using their card at certain merchants. But this wouldn't come from Apple -- they've already said they've engineered themselves out of that kind of control.
You mean big entities like transnational banks and payment networks?
In my case, Apple were attempting to charge me a monthly fee for an app that I installed last year before I ditched my iPhone. After using (and paying for) the app for a month, I realized I didn't like it and declined having a monthly subscription moving forward. After terminating my account with the app and uninstalling it Apple continued to charge me for it for months afterward. Repeated escalations in Apple's customer service labyrinth resulted in a massive amount of wasted time and, ultimately, an admission on their part that they didn't have a clear answer for what was happening or what I did wrong (one customer support person even told me that the same thing had happened to him once upon a time). Despite that, the relevant policy document they referred me to strictly prohibited me from being refunded for the erroneous charges. In the end, the only thing that saved me was being able to turn to my credit card company and flagging the months of charges as fraudulent. In this case I got all of my money back, but the experience really makes me wary of the idea of a big tech company being involved in my finances.
This sort of deplatforming happens for moral reasons (adult content), discriminatory reasons (Suppression of gay activist movements in the 90s), political reasons (Suppression of IRA/ISIS symathisers), legal reasons (Enforcing international embargoes - ie, Iran).
For some reason, though, techies get up in arms when tech firms start doing this.
seriously though, i don’t really think it’s in a company’s purview to promote those values, otherwise they’d let their employees vote on who their ceo should be or wether their jobs should be outsourced or not etc... it definitely is in their purview to maximize their profit and at least in the short-term it would seem banning is “easier” (aka profitable) since it quells any “controversies” quickly enough...
please note, i’m not defending tech companies or payment processors banning merchants etc, just stating how i see it for my limited experience...
Indeed. I may not support the political views of (checks notes) ultra-nationalist furries, but I damn well think in a free society, their right to (checks notes) draw furry pr0n with Nazi flags in it should be abridged only by democratically discussed and broadly supported hate-speech laws.
An "ew no" to one is an "ew no" to all!
Or, a little more seriously, if we're not going to go through with actual social control over these decisions, we shouldn't control them at all. The lived experience of freedom is simply having the smallest possible number of choke-points between you and what you want, subject to not violating anyone else's rights or doing anything so morally horrific it was actually banned by the government (eg: organ trafficking or whatever). Our society needs to stop accepting that privatized, for-profit choke-points somehow give us "more freedom" than a law banning the choke-points (ie: common carrier regulations, First Amendment restrictions on state action, etc).
I think Apple is hoping that the Apple card will get more users to adopt Apple Pay at the point of sale vs. dominate payment processing. Apple collects a small merchant loyalty fee when someone uses Apple Pay at the point of sale, even in cases where the card being used is Amex or Chase. My guess is the overall adoption of Apple Pay is a bigger win for Apple than the card itself. I am not sure there is much cause of concern here yet as people like their CC points, perks, and rewards? It doesn't seem like Apple has leverage here unless everyone stops carrying credit cards?
Yes, they've mostly captured all the regulators at this point so it's like the foxes running the henhouse, but at least in theory that's how it's supposed to work. . .
The jokes almost write themselves. . .
The decision to use GS is highly dilutive to Apple's brand.
You don't need the ball when the chain wraps around the whole world.
There are 3 or 4 tech companies big enough to pull this off, in the whole world.
Both issue cards, and run two of the largest credit card processing systems. Bank of America Merchant Services and Chase Paymentech.
Most smaller providers still depend on one of those larger banks networks to process transactions.
You generally always need an acquiring bank to issue cards or process transactions. I believe this is the role of Goldman Sachs in this Apple news.
(Source: I worked at Square for 6 years, and my teams were directly responsible for the network integrations to connect to those merchant acquirers so we could process credit cards.)
Apple already has a lot more info on users then CCs do.
edit
Apple knows a lot about you IF you use apple products. Didn't think this would be a controversial point :)
Apple has nearly nothing on you. Amex knows what I buy, when, and where.
Maybe they do know lots about me, maybe they don’t. A significant part of their public reputation rests on their respecting privacy concerns however. So if it turned out that they were secretly collecting data on me they would take a hit to their public reputation and (very likely) their bottom line.
They are very much incentivised to keep my data private and imho that offers a strong likelihood that they’ll actually do so.
Wait? What?
Apple doesn't know what I buy. At least not currently. How can they know that? Only Mastercard and Visa know that.
Maybe Apple could buy that information from Mastercard or Visa? Is that what you're saying?
I'd wager that Google, Mastercard, Visa, and AT&T each know way more about me than Apple does. That's not even counting companies like Amazon, Target, etc. It seems to me that with respect to privacy, Apple is the least of my problems.
You could also argue that having multiple big entities doing payment processing is better for everyone to the extent that they are competing. I mean, Mastercard and Visa are undoubtedly going to pull every lever at their disposal to take out Apple. (And to take out Amazon and Walmart as well if they decide to jump into this thing.)
So rather than wishing that Apple were NOT a payment processor, I guess a better idea is to hope for the Walmarts, the Amazons, the Targets, etc to all jump in and join the cage match.
The images shown are labeled the "Apple Mastercard". So it's a Mastercard with Apple branding.
The Apple card isn't competing with Mastercard and Visa -- in fact, it uses the Mastercard payment network. It's competing with credit cards issued by other banks on top of the MC and Visa payment networks (and AmEx/Discover, which unlike MC and Visa combine the payment network and card issuing).
I doubt the other banks are too afraid of Apple though, I didn't see anything so compelling about the Apple card that would cause it kill other credit cards. It's a slick product, but not game-changing the way that e.g. the iPhone was to entrenched phone makers.
It's also disappointing though, because it means Apple is not competing as a separate entity. What we want is for Apple to jump in be an actual credit card company. Then for all of them to try to destroy each other. (Unfortunately, now that I think about it, there are probably legal reasons that Apple is restricted in this regard. That's a shame. Basically means that it's Mastercard and Visa forever.)
Interesting. I thought it offer fairly good Cash Back, no Fees, no hassle, ease of use. Even if it manage to reach 10% of the US iPhone users it will be a serious damage to other CC. While I may not get the best Rebate and Points when using Apple Card, I don't think those few percentage are worth it for my privacy.
Look at the personal finance scene in the UK—it's one of the more vibrant markets for banking right now with the likes of Monzo, Revolut, Monese, and countless others. Convenience and simplicity has prior art there.
I'm fully aware this is an unpopular opinion here, but cryptocurrency is one answer to the conglomerates everyone is complaining about. Is it perfect, or even very good? No. But I use it regularly on major merchants and get stuff delivered without much hassle and pay for my VPSes without trouble.
People want an alternative that is as good as Visa/MC without the conglomerate control. That is not going to happen. You can't get 100% of the convenience of the major processors with 0% of the problems.
When a platform is large enough (or has to be inherently large due to network effects), we should ensure (through regulation perhaps) that they act neutrally and provide service to everyone except where the law explicitly disallows it. That is, they should behave as a "dumb pipe" and not curators.
What's currently in the pipes to help fix this? Sure you can always support someone by mailing them a money order or cryptocurrency, but that is a huge hindrance to most people. It can cripple groups that are political unpopular. 20 years ago, that might have been gay rights groups.
The American finance and payment systems are a Rube Goldberg machine. Too many layers of middlemen adding cost and clunkiness; technology which was barely a good idea in the 1970s. But too many middlemen with a stake in it for anything but the state to blow it out.
I could imagine a system where everyone got a basic bank account for life-- each SSN and EIN is also an account number. The account is managed by the state as a public service, and you can assign it to a local brick-and-mortar bank to handle in-person banking. There would presumably be competition for the business.
That way, everyone would have guaranteed access to direct-deposit payroll and ACH-style-but-less-of-a-boondoggle electronic funds transfers. Push and pull payment APIs could be part of the state provided system, with enormous economies of scale driving the transaction price to essentially zero. Since the underlying service is state-run, it has to support any legal business purpose or the courts will shred it.
The financial tech sector is then freed from having to reinvent basic transfers and accounts again and again, and can focus on value-add services.
It does look sharp as hell though.
I think the big indicator will be if payment overhead goes down with increased competition.
That's why we have democratically accountable regulators
do you write for the onion?
A free market is the opposite of a monopoly.