Hacker News Reader

Comment by HAL3000 | Hacker News Reader

The US seems to be so far behind. For example, in Poland, Europe, you've had online instant bank payments for over 10 years. You’d go to a merchant’s site, click 'pay with my bank,' and an OAuth-like mechanism would log you into your bank to confirm the payment. Now it’s even easier with the introduction of BLIK, which lets you pay in shops, online, etc. Online payments are super simple: you click 'pay with BLIK' on a merchant’s site, go to your bank app (web or mobile), click the BLIK icon, and get a six-digit code valid for 60–180 seconds. You enter that code on the merchant site, and your mobile app shows 'Do you want to pay [xxx amount] to [merchant Y]?' You click yes, and that’s it.

View on HN

Regulatory hurdles from incumbents aside, it's generally the case that a less developed, up-and-coming economy will have new stuff quicker. The US is arguably the birthplace of credit but was one of the last to get chip and then tap. Right now the US is putting internet relays in low earth orbit and teaching computers to generate text on the fly, but the wired internet offerings are inferior to some third tier city in Bulgaria and customer service is abysmal.

SEPA is well established all across the eurozone though, even in countries with considerable legacy infrastructure.

Right but those countries are comparable in size and GDP to US states. The US had wire transfers since the 19th century, credit cards as we recognize them today since the 70s, online shopping since the 90s and online money transfer like Paypal since the 2000s. That eurozone countries would want to standardize on something and happen to largely escape regulatory capture is fairly predictable.

Many European countries had online banking in the 80s. Largely because banks were focused on efficiency, and they wanted to replace checks with wire transfers and domestic debit cards. In order to do that, they had to make wire transfers as convenient as possible.

When online shopping first appeared, wire transfers were the obvious form of payment. Few people had credit cards, because most shops didn't accept them. And shops didn't accept them, because they were too expensive.

(When I got a credit card in the early 2000s, one of the things they emphasized in the marketing was that you could withdraw money from foreign ATMs. And you usually got a better rate than by exchanging cash. It's kind of funny that you are not supposed to use an American credit card for that.)

And then how do you reverse a wire transfer? What's the liability split?

You don't reverse it. It's like a cash transaction in the sense that it's irrevocable, which means people understand it intuitively. But unlike cash, there is an effectively permanent record of the transaction, connected to the participants' legal identities. That tends to discourage scammers. And it all happens within a single jurisdiction.

This is not true, you can reverse SEPA transfers via your bank. You do need a reason though and there are time limits but if a seller just runs away with your money you don't have to go through the courts in the general case.

So as a consumer this sounds like it sucks compared to using Visa.

As a consumer, certain businesses not existing because Visa doesn't like them sucks infinitely more.

Everything you list existed in Europe at the same time or few years later in the worst case scenario.

> the world's biggest payments network, saying it propped up an illegal monopoly over debit payments by imposing "exclusionary" agreements on partners and smothering upstart firms.

Is it the size of the US or the exclusionary agreements? I think without these agreements new payment systems would proliferate faster

The size allows for these kinds of cartels.

The size of the us also allows PR organizations (paid for by these cartels) to influence both voters and law makers all the time.

It’s called “lobbying.”

> Right but those countries are comparable in size and GDP to US states

Yes? So in theory it should be significantly harder to implement a EU wide system when it’s much more decentralized than the US. Yet it only took a few years for SEPA and later instant payments to become universally supported across the EU.

Also developed European countries had all of those things you’ve listed in similar timeframes.

The US is very behind on a lot of areas financially, but their gdp is bigger than all of Europe combined

https://tradingeconomics.com/country-list/gdp?continent=euro...

Cool. And how is that even remotely relevant to anything related to the topic of hand?

If your argument made any sense, you'd be using GDP per capita. And there the US is beaten by e.g. Switzerland, Ireland, Norway (skipping microstates) and all of them are around a decade ahead of the US in banking, at least.

The comment above said that there are EU countries with comparable GDPs to the US.

There aren’t any.

I don’t think per capita matters in this particular case since the difference in gross gdp is so dramatic.

There is a much bigger incentive to monopolize in the US because the pie is so damn huge that it offsets the cost of overcoming regulatory hurdles.

> it's generally the case that a less developed, up-and-coming economy will have new stuff quicker.

My credit card in the UK had chip-and-PIN in 2004 - it was probably around earlier too, though less common. Almost every bank card issued has had contactless for over 10 years too. Simply being a developed economy is not the only reason!

Oh come on! Everybody knows the UK didn't even have banking until Oasis released their first single! Sometimes it gets hard living in the USA, where we have to invent everything for everybody else all the time.

I was using something called "cash" (I think? Not sure) I think here in Sweden in the 90s, probably around 1998, which was chip but NO pin, ie. just like cash, if you lost your card you lost the cash.. That was supported in a very few places but I was constantly nagging shops to support it.

This was then gone for a good while, whereas today I guess its back in a way, you get some kinds oy payments (food etc) without pin, and a few others, until it will require a pin, then allows a few more pin-less buys, but I think it also depends on the sum.

I don't think your argument is all that sound

(1) the way to define up and coming economies seem to fit into confirmation bias and/or survivor bias.

(2) why is size such a strong variable?

(3) US had massive rollout of dial up, why/how did broadband get established if size of existing infrastructure is inversely correlated to adaption of new tech? (If I understand your argument correctly). Broadband should never really have rolled out. For that matter, there is a large deployment of satellite internet in the US, wouldn't your low earth satellite example also be a counterexample?

(4) why would advancement in one sector be counter evidence for market capture and regulatory hurdles in a different sector? The examples just seem unrelated.

(5) US internet speeds have been pretty slow for a long time. Could it be that market capture and lack of competition is a larger factor rather than the cost of adoption? Another example, Japan has been pretty far ahead of mobile phone tech for a while. If the cost of adaption of new tech were the biggest issue, wouldn't they have stagnated some time ago? That was an already saturated market for over a decade, yet still moved forward.

(6) could it be more important that new markets lack existing monopolistic capture?

Though, I will agree that existing infrastructure/deployments do create an inertia for stagnation. I have that view for US road infrastructure. It is all going to last many decades more, and with it the single occupancy vehicle.

Addendum/edit: strike the word "new" on point 6.

Not saying this is who you are, but this is the argument I hear from Americans who have a vested interest in defending the illegal business practices of its cartels and monopolies. "This country is so big, that innovation is hard and will be slower."

I don't believe them. I think innovation is stymied either by monopoly, regulation or both. I think specifically we allowed monopoly to encroach in an unprecedented way since the Reagan era. I think there are a lot of rich guys breaking the law, the Sherman Act and its kin are real, the DOJ and the FTC have teeth again, America can be innovative in every field and it's time for action.

Enforcing antitrust law is the path to better products and services and maybe even a restoration of wealth equality to some degree, because historically starting businesses was what kept the fruits of the American economic pie more distributed than they are today.

Coincidentally, this point came up in another HN thread about California enacting a rule that forces companies to make subscriptions cancelable with one-click.

https://news.ycombinator.com/item?id=41644315

To agree with your point; if the entire EU, with country having completely different level of developpement and banking infrastructure and currency and language, managed to standardize and deploy unified SEPA wires including instant wires, then that argument cannot be accepted for the US.

It's easier and faster (and probably cheaper) for me to instant wire money from one euro to several thousand to any random Bulgarian person or business in their own currency, or for said business to take money from my account, while retaining all banking protection, than it is for two silicon valley Californian to do it short of using a private business solution.

Overall the state of the banking and payment infrastructure in the US compared to their advancement level always weirds members out. Well, not infrastructure not the right word, I'm sure the backend is great but what is exposed to people seem to suck.

It's your money you should be feeling in charge not finding solution to be able to use it.

Someone who defends the insanely slow speed of US innovation with consumer finance has not spent any amount of time talking to folks outside of the US.

There is this wild myth that the US is the only true developed economy.

The US is incredibly insular with how it approaches financial innovation.

As many of us deal with software, it’s the equivalent of “N-I-H Syndrome”.

We’re only just now starting to get Fedwire after India, Australia, the Eurozone, and countless other countries have had instant payments for a while.

> The US is incredibly insular with how it approaches financial innovation.

Financial innovation is more than debit transactions.

The US has thousands of financial products that don’t exist in Europe, far more widespread access to credit and a better credit scoring system, better fintech (For example it’s pretty trivial to get a competitively priced loan instantly approved online in a matter of minutes). Plus Europeans have absolutely garbage real estate products, most people are holding short term variable rate mortgages. I’m sorry but Id take the US system over that any day.

> unified SEPA wires including instant wires

Just to clarify a detail, SEPA bank transfers are not instant yet and until very recently could take 6 days, even between banks in the same country and small amounts.

SEPA Instant has existed since 2017, and in 2025 it will become mandatory for all banks to support for free.

Despite it existing for a long time, support for it is far from universal still.

In Sweden there is only a single bank in the entire country that has proper SEPA instant support. Some banks still charge extra for it as well.

My own bank required some coercion before they would let me send money to my European friends (to pay for shared travel expenses).

> In Sweden there is only a single bank in the entire country that has proper SEPA instant support. Some banks still charge extra for it as well.

> My own bank required some coercion before they would let me send money to my European friends (to pay for shared travel expenses).

Hence the new legislation to make it mandatory next year.

The problem isn't innovation, it's adoption. A general "if it ain't broke don't fix it".

> A general "if it ain't broke don't fix it".

It's much more "will this cost us even a tiny bit more to implement compared to the status quo? Then no". US companies don't hesitate to innovate if it will save them money, especially in the short term (line must go up).

A startup that I worked at that worked on municipal water infrastructure often had to sell to rural areas first because they didn't have a rollout of complex existing systems to decouple and migrate. I suspect that's analogous to what OP is describing; a situation where the entrenched system is difficult to replace because the operations of it are now engrained and well-understood.

For what it's worth, I think you're both right to some degree.

I suspect you both actually agree. What they are highlighting is that the incumbents are actually slower to update or adopt newer technologies, often because they enjoy a position as you described where they don't feel normal market pressures due to a position as a monopoly or as a member of a cartel.

> up-and-coming economy will have new stuff quicker

And the key for this is competition and regulation not (yet) captured by entrenched players.

> Regulatory hurdles from incumbents aside, it's generally the case that a less developed, up-and-coming economy will have new stuff quicker

SEPA is Eurozone wide and has existed for 15+ years. Instant payments were only introduced in 2017 but it didn’t take much time for banks in Germany, Italy, Spain etc. to support them.

Bruh, the only thing the US excels at is high income / cost of living, and making cool infrastructure for the rest of the world, which for some reason it doesn’t adopt.

US is an economic powerhouse due to land/population sizes, but if you look at attention is all you need paper (for example): https://arxiv.org/abs/1706.03762 majority of it is imported talent.

It's like saying that because Apple is paying a Chinese factory to build phones that Apple "builds phones".

This system is really subpar, because it excludes people that don't have a local bank account. I remember in Estonia not being able to book a doctor appointment because the website only had those means of payment, but no "pay with credit card" option.

On the contrary, credit cards are a neutral standard, which is interoperable. It can be improved but it's vastly better than bank OAuth.

I have trouble imagining how you'd get a credit card without a bank account.

Foreign bank account that isn't part of the scheme.

We're right next door and have been emailing money to each other since 2003: https://en.wikipedia.org/wiki/Interac_e-Transfer

Even Cambodia has had instant bank transfers for years now. They are trying to figure out how to get tourists into the system because locals hardly use cash anymore.

Except that US commerce dwarfs pretty much all other countries. Visa & Mastercard arguably play a major role in such dominance.

Reply on news.ycombinator.com