Payment startups disrupt traditional cash-transfer firms | Hacker News Reader

Payment startups disrupt traditional cash-transfer firms

wsj.com

41 pointscaminante11 comments

Strange article. Conflates a bunch of different things: Bitcoin, digital wallets (Venmo), card payments (Visa), currency exchange (Transferwise), and international money transfer (Western Union, Moneygram).

AKA money exchange transactions

In the context of this article, from an end user perspective these are all solutions to the problem of sending money internationally. They may be very different technologies on the back end, but they all compete with each other on the front end.

So, it perfectly mimicks the experience of talking to a journalist about this?

Don't mean to sound snarky, but I offered to help a journalist (back when GigaOm was around) to understand the bitcoin ecosystem, but she would keep getting the categories mixed up (Bitcoins vs altcoins vs ripple vs colored coins), drawing unnatural boundaries between them, and then repeating the confusion 3 exchanges later no matter how many times I explained why the don't belong together and she confirmed that she understood.

Is there reason to suspect Venmo, Dwolla, and their ilk of becoming privacy-invading ad-focused systems (if they aren't already)? I.e. I worry the trend is about tracking and ads, and that's the mechanism for eliminating fees vs the more respectable approach of having a few specialty services that cost something (the Craigslist model effectively).

I actually can't say I really mind the "privacy-invading" here because financial systems are already about the most heavily resold data there is, with the people who are currently charging you the fees (your bank and credit card) making billions off it.

If somebody can take the same data, package it up more nicely, and make the economics work to eliminate fees, I actually don't think we're worse off?

I think if Venmo and Dwolla track all your purchases and did things like share your purchase history with third-party advertisers who might use it elsewhere, that's a real concern. I haven't inspected their privacy policies but am more concerned about their future privacy policies.

If it were as benign as them showing some ads themselves but not sharing any data with anyone else, I agree that it would be worth the trade-off, but it would still be a compromise we'd want to reference in all conversations about this. I haven't seen any reference to these issues at all yet, so I'm just speculating and being cynical.

For the most part checks and EFT have no fees when used inside the US. Making fees to send money to friends an odd tradeoff.

Though free, EFT's aren't instant and, IMHO, require more coordination.

This really isn't the case. Some banks provide free electronic transfers to account holders at the same bank and third parties they have agreements with (i.e. billpay).

It's quite possible when performing an EFT, for the sending party's bank to charge a fee and also for the receiving party's bank to also charge a fee. I'm speaking from experience.

I've paid people outside BofA without paying a penny.

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