Apple Could Be Working with Goldman Sachs on a Credit Card

Re:Apple Could Be Working with Goldman Sachs on a Credit Card by dalyons on Thursday February 21, 2019 @11:52AM (#19218191)

idk why you're downvoted; australia did exactly that recently - there's now a federal law capping credit card interchange fees at 0.8% maximum. The EU is now 0.3% max.

Of course that means that you dont get so many fancy rewards benefits, but thats kinda silly anyway (getting ~1% back in rewards in exchange for a ~3% tax on everything)

EDIT: also, it feels very discriminatory. Well off people get the fancy cards with the biggest kickbacks, poor people get shitty cards with no benefits, but everyone pays the hidden 3% tax....

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by tfehring on Thursday February 21, 2019 @02:08PM (#19219643)

> Of course that means that you dont get so many fancy rewards benefits, but thats kinda silly anyway (getting ~1% back in rewards in exchange for a ~3% tax on everything)

It's definitely kind of silly and it's definitely regressive, but your numbers are off. In reality, I get ~2% back in rewards in exchange for a ~0.25% tax on everything. The math for this works out because most transactions aren't made with credit cards. https://www.bostonfed.org/publications/public-policy-discuss...

I'd still support regulation that addresses this - either by directly capping interchange fees or using a different approach - but I personally won't be better off because of it.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by dalyons on Thursday February 21, 2019 @04:39PM (#19220790)

fair point on the debit lowering the effective "tax".

I'll point to my edit and restate that its better for you, because you're well-off enough to get a 2%-back card. I'm guessing that the average across all cards/americans is much lower than 2%.

(i'm an immigrant to the US, and for the first few years all you can get is the crappy starter cards available to people with poor/no credit, that have no benefits. These days, im in your boat - i qualify for the fancier cards so im essentially making money of the back of everyone that doesnt. So i would be worse off too, but i think thats fine)

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Thursday February 21, 2019 @12:01PM (#19218294)

As long as vendors are free to offer different pricing based on payment method, it should resolve itself.

Even right now, I don’t think there’s is anything stopping vendors from offering everyone x% off by using debit cards.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by leesalminen on Thursday February 21, 2019 @02:39PM (#19219861)

You can do it with credit cards as well. The trick is that the merchant must frame it as a “cash discount” and not a “card surcharge”. This means that the prices posted are the “full price” and then you can discount it on the cash.

There’s been a lot of back and forth on this over recent years, but this is my understanding of what’s currently allowed. Could change tomorrow if Visa changes their mind.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Thursday February 21, 2019 @03:15PM (#19220188)

The FTC's website clearly says the merchant is free to offer a discount for different methods of payment, such as cash or debit card, so I don't think Visa has any power here.

https://www.ftc.gov/tips-advice/business-center/guidance/new...

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by FabHK on Thursday February 21, 2019 @12:05PM (#19218325)

> long as vendors are free to offer different pricing based on payment method

My understanding is that the merchant agreement the vendor has with the credit card company prohibits that.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Thursday February 21, 2019 @12:54PM (#19218894)

FTC website says different:

https://www.ftc.gov/tips-advice/business-center/guidance/new...

>Discounts to Customers A PCN cannot stop you from offering your customers a discount or another incentive for using a certain method of payment, as long as you offer it to all your customers and disclose the offer clearly and conspicuously. For example, you can offer your customers a discount or a coupon if they pay with cash or a debit card rather than a credit card.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by maxxxxx on Thursday February 21, 2019 @12:37PM (#19218689)

"As long as vendors are free to offer different pricing based on payment method, it should resolve itself."

Credit card companies do everything they can to block this.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Thursday February 21, 2019 @12:54PM (#19218901)

I was under the assumption that this is still in effect:

https://www.ftc.gov/tips-advice/business-center/guidance/new...

>Discounts to Customers A PCN cannot stop you from offering your customers a discount or another incentive for using a certain method of payment, as long as you offer it to all your customers and disclose the offer clearly and conspicuously. For example, you can offer your customers a discount or a coupon if they pay with cash or a debit card rather than a credit card.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by gbrown on Thursday February 21, 2019 @12:35PM (#19218662)

There was just a lawsuit about that, and it went... poorly.

https://www.washingtonpost.com/business/economy/supreme-cour...

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Thursday February 21, 2019 @12:53PM (#19218886)

I think that only applies to other credit cards, but not debit cards or cash:

https://www.ftc.gov/tips-advice/business-center/guidance/new...

>Discounts to Customers A PCN cannot stop you from offering your customers a discount or another incentive for using a certain method of payment, as long as you offer it to all your customers and disclose the offer clearly and conspicuously. For example, you can offer your customers a discount or a coupon if they pay with cash or a debit card rather than a credit card.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by gbrown on Friday February 22, 2019 @10:23AM (#19226056)

Still, that kills any incentive for fee competition between cards - they all share the benefits of being convenient and face little pressure to change the fee structure.

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Re:Apple Could Be Working with Goldman Sachs on a Credit Card by lotsofpulp on Friday February 22, 2019 @09:03PM (#19231112)

But it’s not stopping the merchants from offering discounts for debit and cash, debit cards of which have capped fees and are very cheap to process.

Merchants are choosing not to give those customers discounts.

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