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Comment by advisedwang | Hacker News Reader

I think of it this way: does a business have an option not to do business with Visa? Realistically no. They have all the market power that a monopoly has.

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Costco (in Canada at least) doesn't work with Visa. It's cash, bank debit cards, or Mastercard. (No AmEx/Discover either.)

It can be done, at scale, but definitely a business risk.

Costco in the US doesn't accept Discover but does accept Visa. Heck, they even offer a Visa credit card which stands in as your official membership card.

They used to only accept Amex and had a branded card. It worked fine for them that way too.

This change happened in 2015, for anyone who remembers Costco and amex being inseparable: https://www.costco.ca/_ax-faq.html

In part this is because of the existence of Interac though. If Interac didn't exist it's possible they would feel they need to use VISA to not turn away too much membership. Having debit as a fallback means they can partner with whomever gives them favourable terms. I doubt Costco is paying Mastercard a % of the transaction the way most other retailers are.

Despite it existing since the 80s, there's been constant pressure / lobbying to get rid of it.[1]

[1]: https://www.theglobeandmail.com/report-on-business/interac-i...

In the US, bank debit cards are commonly Visa, although they can often be run on multiple networks, debit is confusing.

Costco is membership-only, so everybody shopping there is strongly incentivized to do so bearing the payment methods they accept.

A random corner store or online retailer does not have that luxury; they have to accept whatever their prospective customers have on them (and to a lesser extent prefer, if they have multiple brands' cards).

Costco in the US only accepts Visa. I have a membership, and it's an annoyance because all of my credit cards are Mastercard or Discover, so I have to use my Visa debit card.

Bank debit cards in the US all also use Visa or Mastercard networks.

Costco in the US used to only accept Amex.

I assume they changed to Visa because Visa offered a better deal.

Seems like the opposite of a monopoly.

Interesting. In EU, I never saw a business accepting only Visa but not MC or vice versa.

The only two semi-exceptions:

- during a MC-sponsored event, you had extra fast lanes when paying with MC (Roland Garros in Paris)

- Ryanair (low-cost airline) would accept free payments only with some niche cards (Visa Electron, Mastercard prepaid) and charge like 10€ extra per flight segment for any other card, until I think EU forbid it.

There are tons of cash-only businesses.

There are also a lot of businesses that take cash because their owners have been banned from taking credit cards.

> does a business have an option not to do business with Visa?

Absolutely. There's Discover, Mastercard, Google Pay, Apple Wallet, crypto, checks, and good old-fashioned cash.

Apple Pay and Google Pay are not payment networks. Those are just Visa and Mastercard.

It depends on your payment gateway. I can setup a POS payment system with any payment gateway processor I want. Depending on the system you can essentially run direct deposit into Google Pay, and as a vendor I can direct deposit the money into my checking via my gateway.

But that's not the issue being contested because there are hundreds of payment gateway processors available.

Right, you CAN set that up, but in the US, not accepting visa and Mastercard is essentially untenable if you are a retailer or restaurant. You might be able to avoid accepting AmEx, but from talking with restaurant owners, the biggest spenders are often AmEx holders and are annoyed at having to use a backup card.

Which of those is realistic though. They exist but you turn away customers with money who cannot pay.

That's not how the payment market works, though.

If a customer walks into your store and has exactly one (type of) card on them that they want to use to pay, you have a choice of accepting that card or losing their business.

This makes competition between payment methods at the POS structurally very hard.

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