As for wire transfers, they are most definitely not free to send or receive in the US. Fees are on the order of $25 each way depending on the bank, and actual humans and faxed forms are involved.

Everyone pays their credit cards off every month because it's the law. If you are unable to pay, you can work out arrangements with the bank. If you need to use lots of money you don't have, you ask the bank for a loan and pay it back gradually.

It's my understanding that in the US, card companies make their money off fees and interest, which to me sounds like a much less appealing system designed to take advantage of the consumer.

But even if they never saw a penny of income directly from me, what they would still get out of it would be the data. And insight into the purchase habits of consumers with plenty of expendable income - the same people that would otherwise be a losing proposition for a business that actually relied on failure to pay on time to stay afloat - seems like it'd be far more valuable than the entirety of what they'd be able to squeeze out of the already-cash-strapped.

I'm actually highly impressed at the extent to which they're completely successful in focusing the public discussion on their "outrageous" and exploitative policies. They put on a thoroughly convincing show of fighting tooth-and-nail against regulations to reign in that behavior. But I think it's because, if it ever got seriously done, people would start asking how it was they were still in business - and they would definitely still be in business. But the finance operation is just how they collect the raw material for their actual product.

1. Your argument is premised on the fact that since you personally have been offered a credit card, and you personally have almost no credit history, that therefore credit card companies don't make money from charging interest on late-payments. That's an absurd premise.

2. I believe, based only on my subjective observations, that you are the exception in your use of credit. Many people are irresponsible in how they use credit cards and end up paying exorbitant interest to credit card companies. Mostly lower-middle class individuals who are trying to live beyond their means. In Canada the average citizen carries ~20 000$ of personal debt (excluding mortgages) and the majority of that is credit card debt.

3. I think you're ignoring the "brand" value of having market saturation for your product. For example, Coke vs Pepsi. Yes they are not exactly the same product but they're very similar and there's no doubt that Coke has reaped a huge benefit from having dominant market share. When you go to a diner and order a burger, and they ask you what you want to drink, if you want a cola you say "I'll have a Coke please". Its understood by that request that you want a cola, and would likely be okay with either a Coke or a Pepsi, but regardless you said Coke, and there's the value of market saturation. So yes the credit card companies want to get as many customers as possible to use their product in an attempt to saturate the market.

4. Credit card companies also charge merchants for using credit cards so even if the customers paid all their bills on time the credit card companies would still be making money. I don't imagine they make the majority of their money from charging merchants but it is still revenue they want in their coffers.

5. Your final point borders on a conspiracy theory.

Wire transfers are absolutely unheard of at the consumer level outside of things like escrow for a house.

Luckily all eftpos POS terminals have a quite strict protocol upgrade regimen, and in the last ~5 years or so, it's becoming more common to request a Visa/Mastercard debit card (for a low but non-zero price) instead of an eftpos card (free with a bank account).

And additional ancedata because I don't know whether that's a US <> Europe thing: Personally, the idea of going into dept for private consumption is completely foreign to me and most people I know, so the idea of a credit card is very unappealing.

Wire transfers OTOH are simple, practically free and fast enough (<1 day inside the country, ~1 day inside of Europe).

Though I know many don't follow this rule, I never purchase anything on a credit card I don't have cash for. It's purely for the convenience factor (and the 1-3% discount on all purchases).

I wouldn't pay for one though.

The main reason I got a credit card initially was because when I visited the US, nobody understood what a Maestro card was.

In the Netherlands, both bank accounts and credit cards require a monthly fee (€5 / quarter for a bank account, €17,50 / year for a credit card).

I have accounts in both countries and I rarely need to fall back on my VISA card. Indeed, online payments here use an NL specific payment system called iDEAL, which makes use of your bank's online banking - it's far faster than entering 16 digit CC numbers and can integrate with your bank's app on mobile.

There are a few (very few) that does not have an annual fee though.

You don't pay annual fees for your credit cards?

In fact, some credit cards will pay you a rebate on your purchases. One card I have gives me back 1% of everything I spend (the credit card company charges the merchant 2-3%, so they still come out ahead). Since I pay off my balance every month and thus pay no interest, using my credit card actually saves me money over paying in cash.

Plus US banks give out VISA debit cards, making it a non-issue (well, security/chargebacks might be). Dunno about EU, but in Canada, this doesn't seem easy. I opened a business account, then asked for a VISA debit card and both the service person and manager appeared to be confused as to what that'd be. They insisted I could pay things using Interac (Canadian card network), with no concept this wouldn't work for online use. They kept thinking I wanted a credit card. Bizarre.

Maybe there's some huge cost to making MasterCard or VISA connected debit cards?

Except that debit cards in the U.S. are not covered by the same consumer protection laws as credit cards[1], so it's harder to do stuff like disputing charges. It's also possible for an erroneous charge on a debit card to wipe out your bank account. For that reason, I specifically ask my bank to give me a card that does not work as a debit card, only as an ATM card.

[1] E.g., the 'Fair Credit Billing Act', a federal law that protects credit card transactions, doesn't apply.

I address the same problem by having multiple bank accounts that have small balances and auto-depositing my monthly budget for different things into them. If any one gets compromised (and the bank is unwilling to fix it), it doesn't take out my whole bank account. Plus it provides a nice "money into envelopes" style of budgeting that's very easy to understand.

If your card only works at the ATM, then how do you buy expensive things (something that costs more than the daily ATM withdrawal limit)?

How often do you go over 4000€ and pay for it at point of sale?

Usually, you sign a contract, and wire the money to VW or wherever you bought your car, or you wire it to the bank where you bought the shares.

I have credit cards for buying things.

Neither is bitcoin, so pretty sure that's irrelevant for this discussion.

So whether these cards are worth it depends a lot on how you use your card, but, they can pay for themselves very easily.

Nope. Actually, they pay me at a rate of 1-5% cash back on all purchases made on the card.

Or pay more like 200€ a year for one with better protections for your money, which I’d get for free with EC?

All of those require you to have taken at least one loan or credit in your life, or to have an income.

I’m a student, and I was raised to never ever go into debt – I never had a single cent of debt to any institution, the maximum I ever had to a single person were cent volumes.

I tried, seriously.

Even the "free" prepaid cards cost money (usually several euro) to recharge.

> Aufladungen sind der Höhe nach nur innerhalb der vereinbarten Grenzen zulässig. Für die Aufladung der Karte wird ein Ladeentgelt gemäß Preisverzeichnis verrechnet.

https://www.wirecardbank.de/fileadmin/user_upload/wirecardba...

> Monatlicher Freibetrag: 100€ Danach: 1,5% auf Mehrbetrag

As far as I can see, that’s the only limit.

But, also, if you do not have money on the card, your contract is automatically cancelled, and they’ll refuse to reopen one with you.

> Das Kreditinstitut kann die erforderliche Zustimmung versagen, wobei insbesondere die Nichtzahlung des Aufladungsbetrages gem. Ziffer 5 ein Versagungsgrund ist.

https://www.wirecardbank.de/fileadmin/user_upload/wirecardba...

But indeed, it’s a very ideal card, for a German bank. I’ll bookmark it.

Absichtlich verwirrend geschrieben.