In case of China, put it into another perspective. Chinese banks have long been state-owned and very ineffective. Credit cards are incredibly difficult to apply, and cumbersome to use after you get it because the banks refuse to pay you back in case of frauds. This is why WechatPay/Alipay could be so successful:
1.There is no existing dominating technologies.
2.It mitigate the fraud problem that it is harder to stole/clone your card.
3.The onboarding process is really easy.
All in all, I think mobile payment takes off in China is pretty logical, while in other countries, like Japan/South Korea, it is not common at all, even though they are close to China culturally and their economies are considered to be more advanced than China's. This is a classic example of second mover advantage, that China could enjoy this great leap forward, only because it is not advanced enough before so doesn't have all the legacy to carry along.
However, I agree with you that US needs to ditch the illusion, that it is still the norm of innovation and others should follow. The world is getting diverse once again after the cold war, more and more innovations will happen elsewhere, like in East Asia or India. Time to let go of that useless ignorance and set down to truly listen and, learn.
The thing is though is that the US has a habit of getting these things decades after they're introduced.
The US has just started EMV rollouts and it's still the only country that depends on signatures. Most of the developed world has had EMV with a PIN for what, 15 years now?
Contactless payments have been widespread in Australia (home) for at least 5 years and by "widespread", I don't mean a few particular retailers support them, I mean everything from the independent coffee or fish and chip shop down the street to every major supermarket chain, cinema, Starbucks and McDonald's.
The US is just barely keeping itself 5-10 years behind the rest of the world.
And none of your comment actually happened.
So yes, it actually can happen. But it doesn't require digital cash.
In case you are arguing that the <1% fee should be considered as a part of the overall "interest" rate, well, that small fee does bring you the real convenience.
I lived in Beijing for 9 years. It changed much since then, but the tech brought out was solving mostly local problems with local solutions. When I started living there, I used to pay for rent by withdrawing 20K or so RMB from the ATM machine (in 100 bills), loading it into a bag, then giving it the landlord. I never did that in the USA before, never had to, it wasn't the problem the USA had. Now I can use Wepay, oh, or I can go to the bank and do a direct funds transfer (as a foreigner, I could never get ebanking setup).
> If every American had to fly to Tokyo or Seoul for a week, I think we'd put up less with our failing infrastructure.
All of these places have their own thing. Don't get confused and think that the problems they are solving are much better than the ones we are. I've had plenty of trouble in Tokyo that I wouldn't experience in the states (dammit, streets should have names!), they are just different.
That's probably the same kind of stuff here. The US did develop a universal non-cash system decades before other countries and now is stuck with its quirks. Europe started later and is slightly better. China started even later and could just use the fact that even poor people had an internet connected computer with them at all times except in the shower.
Its an attack from both sides, though. Monied established interests systemically manipulate the economy through the state to prevent competition and innovation from gaining traction, while the people are indoctrinated into anti-intellectual and anti-progress ideologies and thus personally resist change.
Both are done for a profit motive, so the real problem is probably the simplest to acknowledge but the hardest to solve - corruption.
The Durbin amendment (see quoted statute in other comment) prevents networks from forcing small merchants to accept small charges, not merchants from imposing minimums on consumers.
State and local laws can still prohibit CC minimums via statute or via licensing.
That is exactly the type of agreement that the Durbin amendment prohibits. I don't see any mention of state or local laws prior to now, so that seems like a complete non sequitur to me.
Yes, exactly like I said. It prevents processors from requiring merchants not to have minimum charges. In other words, it prevents processors from making agreements with merchants where "requiring minimum purchases is a violation of the merchant-processor agreement". It doesn't stop someone else from stopping the merchant from having a minimum charge, but it does stop the type of merchant-processor agreement that you described.
The start of the thread was the claim that the Durbin amendment made it illegal for merchants to set CC minimums for consumer purchases. That's the false interpretation.
> the law requires that processors allow merchants to have a minimum purchase requirement of up to $10
"(3) NO RESTRICTIONS ON SETTING TRANSACTION MINIMUMS OR MAXIMUMS.–A payment card network shall not, directly or through any agent, processor, or licensed member of the network, by contract, requirement, condition, penalty, or otherwise, inhibit the ability of any person to set a minimum or maximum dollar value for the acceptance by that person of any form of payment.”
It does not inhibit state or local jurisdictions from banning merchants from setting card minimums in their individual credit card consumer transactions.
America needs to admit that it's no longer the bastion of innovation that it once was (I say this as an American. If anyone doesn't believe me, just take a trip to East Asia). Americans are complacent and fine with not having the cutting edge (not to mention our failing infrastructure).
I wish there was a way to change this attitude, but it feels like most people are too busy working and paying off their student debt. If every American had to fly to Tokyo or Seoul for a week, I think we'd put up less with our failing infrastructure. Or maybe this "Everyone for themselves, it's someone else's problem" greed mindset is too ingrained in our DNA.