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Comment by ecopoesis | Hacker News Reader

Because credit card rewards aren’t free? Banks compete for credit card consumers by offering rewards. Those rewards cost them money. Selling consumer information is another revenue stream to make up for the cost of rewards. Most consumers are okay with this trade off: they get their airline miles / low interest / cash back in exchange for their purchase history.

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>Because credit card rewards aren’t free

So this isn't covered by the 1-3% transaction fee the merchant pays every time you use your card?

>Most consumers are okay with this trade off

No they aren't. Most consumers aren't even aware they are paying with their privacy, so you cannot take a low opt-out rate to mean high levels of consent.

It doesn’t matter if credit card providers are paid 0%, 3% or 5% on each transaction. If the law (and/or customer blowback) allows a company to sell customer information, management will eventually give in to selling it because it’s a revenue source. When called on this they will give you a story about how it “lowers customer costs” and some people will accept this as a valid excuse, but none of this changes the reality.

PS: this is really a response to grandparent poster, not parent.

Speaking with coworkers that aren't tech workers - nobody gives a damn. Not one, not even something resembling one. To them, they are getting paid for something they otherwise have no use for. They're aware everything is tracked about them, and they do not give a fuck.

Your friends, family, and coworkers might though, so the critical mass of people not okay with this can still grow :)

Credit cards are such an American thing though. Here in UK pretty much everyone uses debit cards with no rewards. I actually have a credit card just for emergencies but it offers no rewards either.

In order to bootstrap adoption of CCs, the banks pushed for a law in the 60s that put all the fraud liability on the banks, not the card users (and, to a lesser extent, not on the merchants). Your CC purchases are quite protected and it's easy to dispute a charge (apparently a very big deal in the phone and online sex businesses).

As debit cards became popular here (well after Europe) the banks push them hard on people who aren't excellent credit risks (good credit risks = profit), because they push essentially all the risk onto the account holder and absolve the banks of any responsibility.

I have three CCs (one of each major network) and pay them off every month; it's like having three debit cards except I get a free loan of a month's worth of spending. The term used in the banking business for people like me is "deadbeat"

So here's the thing - I don't understand the liability thing. At least here in the UK I have disputed transactions on my debit card several times and every single time the charges were reversed during the phone call, I had the money back instantly. Is that only available for credit cards in the US?

That is correct.

Citation needed. I use credit cards exclusively so I cannot say for sure, but I am extremely skeptical that banks don’t offer any fraud protection on debit cards in the US.

AFAIK the main reason people prefer CC’s over debit cards for fraud prevention is simply that with a debit card your money comes out immediately if it is used by someone else, whereas with a CC there is a 30-day buffer.

Literally the first links when I search for ‘fraud protection credit card debit card” are below.

The TL;DR is:

- you have a short window to report DC fraud before you bear the full risk; CC risk is capped

- dispute a CC charge: you don’t owe anything / accrue interest until resolved; DC case you don’t get any money back until bank decides it’s not your fault. Tough luck if you needed that money to pay your rent.

https://www.consumer.ftc.gov/articles/0213-lost-or-stolen-cr...

https://www.experian.com/blogs/ask-experian/are-credit-cards...

https://www.nerdwallet.com/article/credit-cards/credit-card-...

https://creditcards.usnews.com/articles/why-credit-cards-are...

https://komonews.com/sponsored/wafd/financial-focus-tips/cre...

Don't you have to pay interest on your average balance even if you pay off your balance every month?

Not GP, but the answer is no if you pay the balance in full every month. The issuer anyway makes money from the MDR (merchant discount rate) charged to the seller. But they would love customers who pay a partial balance regularly (at or above the minimum due) and charge them hefty interests like 20% per annum or 36% per annum or even higher, depending on a few different factors. Once you carry over balances from month to month, then every transaction attracts interest until the entire balance with interest is paid off.

And then on charge cards (NOT credit cards) like American Express, you don't even have the option to carry a balence. Full balence must be paid every month in it's entirety.

CC in the UK use to have some nice rewards - and there are advantages in buying some thigs via credit card holidays for example.

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