Comment by hardwaresofton | Hacker News Reader

Comment by hardwaresofton | Hacker News Reader

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> Stripe and Swish solve different problems. Swish is mobile phone based direct bank transfers, Stripe is credit/debit card transactions.

At a higher level of abstraction, these are are the same problem -- conveniently and safely paying money to another entity (whether person or business). If we assume that normally someone has a phone at the same time they have their credit/debit card, then the how isn't really that important is it?

> The big problem with Swish is that it only works if you have a phone with a Swedish SIM card and a Swedish bank account in a supported bank (which admittedly is most of them). With Stripe you can take money from anyone with a Visa or Mastercard

This is why I asked inside countries like this -- if you're in Sweden and (I saw a documentary on DW a while back about how cash is actually becoming so rare that handling it is starting to be disincentivized -- ATMs disappearing, banks not wanting to hold cash because of relative liability, etc), let's assume you have a phone with a Swedish SIM card and a Swedish bank account and a phone.

Swish in Sweden is just the only good example I know of, but I think that after a while something that looks like it will be everywhere (US, EU, UK, etc). Cashless economies are generally welcomed by governments and most businesses, most people don't even know the usual privacy/accessibility/etc talking points (opposite from the usual HN reader).

So again, in a situation where it is very likely that you could use Swish with ~0 fees or Stripe, do people continue choosing Stripe?

Or a better question -- how easy would it be to compete with Stripe (without having to offer the key lower parts of the stack that Stripe initially solved)?

BTW Stripe also does ACH -- I use it for larger payments when dealing with clients and it works very well.

So again, in a situation where it is very likely that you could use Swish with ~0 fees or Stripe, do people continue choosing Stripe?

Why not both? First of all, Swish is only free for transfers to or from private individuals. Companies pay a pr transaction fee. I don't know how the fees compare, but it is probably not a huge difference. If you're a company handling a huge number of transactions pr day I suspect you'll be able to negotiate a better deal with a card processing company.

Also there are still people inside Sweden who have credit/debit cards but not Swish, for example tourists, older people or people here on temporary work contracts.

Secondly there are reasons why people would want to use a credit card instead of having the money taken directly from their bank account. One such reason is if it's a company making the purchase it is much more convenient to use your company card. Another aspect is if you have more than one bank account (say your personal account and a joint account with your spouse) then you might have different cards tied to different accounts. You cannot do that with Swish.

Basically while there is some overlap between Swish and companies like Stripe, they aren't really drop in replacements for each other.

Edit: From a technical point of view there is probably nothing stopping Stripe from adding Swish as a payment option to their API if they wanted to have that as a feature for the Swedish market.

These are very good points. I had it in my head htat

> Why not both? First of all, Swish is only free for transfers to or from private individuals. Companies pay a pr transaction fee. I don't know how the fees compare, but it is probably not a huge difference. If you're a company handling a huge number of transactions pr day I suspect you'll be able to negotiate a better deal with a card processing company.

Yeah but this is just an extension of... taxation when the government does it right? The fee seems to be 2 kronor[0][1] this is static not %-based. I'm not a huge payment processor but $0.24 USD/transaction seems REALLY good to me. The fact that it's not % based is just a complete shift of the cost dynamic -- if you sell something for $1000 and pay 0.24 for the transaction the fee is 0.00024%. I don't know what kind of numbers you have to do to get that from a card processor.

> Also there are still people inside Sweden who have credit/debit cards but not Swish, for example tourists, older people or people here on temporary work contracts.

Yup, I've heard this mentioned, people who went for a concert had a terrible time, etc.

> Secondly there are reasons why people would want to use a credit card instead of having the money taken directly from their bank account. One such reason is if it's a company making the purchase it is much more convenient to use your company card. Another aspect is if you have more than one bank account (say your personal account and a joint account with your spouse) then you might have different cards tied to different accounts. You cannot do that with Swish.

This is a good point -- but I want to push back that you can't do it with Swish now. Doesn't feel like a really hard problem.

> Basically while there is some overlap between Swish and companies like Stripe, they aren't really drop in replacements for each other.

They aren't drop in replacements for each other if any of the scenarios you've outlined is the case, but I intended to restrict the situation to the case where they are roughly identical. In that situation, do people use stripe?

> Edit: From a technical point of view there is probably nothing stopping Stripe from adding Swish as a payment option to their API if they wanted to have that as a feature for the Swedish market.

Ok so this is a bit closer to what I'm trying to get at -- Why would a merchant pay ~3% compared to 2SEK? Is Stripe worth 3% when all you need them to do is process the payment?

[0]: https://insights.nordea.com/en/innovation/the-benefits-of-sw...

[1]: https://medium.com/@etiennebr/swish-the-secret-swedish-finte...

MobilePay in Denmark (which is about the same as Swish, with very similar constraints wrt to phone numbers and banks) seems to be trying to enter the online payments business. But it does require MobilePay which is ubiquitous in Denmark, but utterly useless outside of it. So the rollout to other markets is slow to non-existing (and given how Danish banks - which run MobilePay - seem not to be aware of the rest of the world), so if I were a merchant no way in hell I would chose to exclusively accept MobilePay online.

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