~$92.8M for 2.9% fee. ~$12.6M for 30 cent fee. ~$105.4M just for processing transactions on a single day.
Above assumes the “standard” pricing [1]. It’s not quite clear how much stripe takes from the 2.9% and 0.30 cut. Likely have to share this with card network and issuing bank.
The invisible hand of traditional banking system taking money out of our pockets every time.
I have no interest in bartering or sending ounces of gold around.
And don’t say crypto - last time I tried to figure it out, I ended up sending ETH, and more than half of it evaporated in “gas money”. What a joke.
A good “FedNow” or instant payment provider can easily disrupt the debit and credit card processing companies. At most, businesses charged 5-10 cents per transaction.
No more dealing with credit card network fees. Chargeback fees. Exchange fees. Issuing bank fees. Premium card fees. Just a simple 5-10 cent per transaction. Only need a US bank account.
Spoiler alert: it has not eliminated the need for credit cards. The credit card system has a lot of flexibility and integrations to make for a superior user experience in a number of situations. For example, a lot of banks let you create virtual cards for specific purposes (eg: I have one for all my online subscriptions, and another for merchants I've not dealt with before). Not to mention Apple/Google Pay and their integration into basically every single online payments platform.
If you want to go all the way into the consumer value matrix - Has anyone on HN ever had much a 2nd thought about whether or not their card would 'just work' out in the world?
I used to work in the actual room where acquirer links were monitored in real time 24/7/365. At least 8 people were in that room at any given time. I've never worked in nuclear power but I imagine you could draw some parallels.
This kind of reliability is not cheap or easy to come by. There isn't a clever technical trick you can employ to realize it. The only way to achieve the kinds of reliability we have in the world today still requires lots of human involvement throughout.
Does anyone dream of having a google-style support experience next time they are standing in line at the grocery store? This is basically what you are demanding when you say you want zero % fees on all transactions.
It’s always been a hard problem to solve, and the bankers who solved it always got paid handsomely for enabling commerce.
In the old days everyone bartered. Then came shells. Then precious metals. The gold had to be literally shipped around. Everyone from the Roman to the British empire had to physically ship chests of gold to it’s soldiers. Cross border commerce was absolutely fraught with risk. Piracy and shipwrecks galore.
Then the Rothschilds opened the first international bank, dramatically cutting the difficulty and expense of international trade.
We got cheques, paper money, and the credit card control room you worked in.
At every step, it got faster, cheaper, safer, more ephemeral. Trade increased dramatically. It’s amazing! The much-maligned banking sector is really a triumph of capitalism.
> The much-maligned banking sector is really a triumph of capitalism.
Yes, the triumph of "what's in it for me".
Do you want to send little bits of gold and silver all around the world, or would you prefer modern banking? The choice is yours, pick the one that's best for you!
Seriously, if the whole crypto scene taught us anything, it was that a global transaction network isn't an easy service to provide.
Yup. Wake me up when any of them actually does the amount of transactions Stripe and Shopify [1] do. Real transactions.
> Maybe you mean the regulatory aspect, not the technical?
"Both. Both is good".gif
[1] Their dashboard discussion is here: https://news.ycombinator.com/item?id=38403891, the dashboard itself is https://bfcm.shopify.com
Both... but also neither. I meant mostly the marketing aspect. Or for a better word, prestige aspect. People really hate crypto as online cash. Examples:
1. Patreon has held a poll about what new features to add [0]. Crypto was the only feature the creators actively voted against. Note that for creators, crypto means one more way to receive money.
2. My anecdote: I was in a discord group where one member commissioned a short animation from another. They're from different countries and the commissioner couldn't use paypal (for some reason) however. I suggested USDT and explained how to convert it from/to fiat.
They ended up using international wire transfer (fee: ~$30).
3. Any HN thread when you mention crypto.
[0]: https://news.patreon.com/articles/the-first-ever-patreon-cre...
This is a clear situation where the market is inefficient.
It's also not the full picture to call them state funded. They're owned by a consortium of banks, both private and public. While the state maintains a level of ownership through their equity in public banks, the company itself is self- sustainable from an operations point of view.
https://bfsi.economictimes.indiatimes.com/news/fintech/upi-t...
The government gives Rs 1,300 crore as subsidy
Unsurprisingly, there is now a 1.1% interchange on some UPI transactions now: https://www.onmanorama.com/news/business/2023/03/31/upi-tran...
Separately, NCPI's revenues are USD ~2B/year: https://www.icra.in/Rationale/ShowRationaleReport/?Id=122149....
Though how credit card processing fees relate to sloppy security is mostly a brainfart by me.
Pretty sure nobody is forced to buy info products on Black Friday for an 80% discount.
???