Also, please don't bank with HSBC. They are the worst of the worst. You'd be better off with Wells, that's how bad HSBC is. https://www.icij.org/investigations/fincen-files/hsbc-moved-...
I just noticed:
If you're right, that his point was just, "between powerful agents within this platform, there exists a state of mutually assured destruction that makes them play nice", then ... well, that's not much of a defense.
The test of a platform is whether it defends the rights of everyone, not whether the few big-time power-brokers can defend themselves by such long-term game-theoretic threats.
The same provider also give 25 IBANs per account. I could, for free, put 25 virtual debit cards on them, and have the IBANs empty unless I put money on it. Good luck scamming me this way. After all, the accounts are empty except for a few min when I put money on them to spend it.
What's name of your debit card provider?
So you find my card in the wild, good luck.
Most of the time that's an anti-feature - there is no point of hiding transactions of you buying bread, it could provide you an alibi in case you are accused of a crime, but there is no conceivable way it could be used against you.. (people don't stop to buy bread on the way to the crime scene)
I think that GP is concerned with being able to show that they didn't commit a crime, rather than that they frequently commit them.
That said, I generally prefer cash for in-person transactions, not just for the anonymity, but because most smaller retailers pay much higher fees to the credit card processors than big ones.
An excellent example is NYC taxis. The CC processing goes through a couple different levels of "service" providers and the drivers get dinged for 5% on every transaction. Whereas a large retailer is likely only charged 0.5-0.75%.
Which can make a big difference for people like cab drivers. As such, I always pay cash for taxi fares.
Paying by card has saved my butt several times, when I was able to prove to a retailer when and where I bought a product for warranty purposes, or get out of a contract that had 2 weeks 'cooloff' period to terminate but the agency kept playing dumb and 'loosing' all my letters and emails.
In the northeast there are tons of cash-only bars and restaurants (im sitting in one), food places (especially hot dog stands lol), and housing/plumbing/electrical contractors (friends with a few that offer _steep_ cash-only discounts).
Cash is king if you want to avoid government scrutiny.
Not being able to indebt yourself is THE major advantage of debit card. Not everybody in this world is reasonable when it is about spending and finance management.
In some European countries with a more conservative mindset related to debts (Germany, France, ...), people will tend to have the exact opposite stance :
"Why would I ever need a credit card ? It is dangerous. My debit card is accepted everywhere"
Suppose you charge $1000 each month at the rate of about $33 per day, and also pay it off when the bill is due.
In a year, you've gotten 1.5% of $12,000 back which is $180, but you could also look at it as though they are paying you 36% per year to use (on average) $500 of their money.
The latter interpretation makes it seem irresistible to me.
The business doesn't lose 3 percent of revenue, because it also saves money not dealing with cash:
- eliminates cash theft - always a chronic problem for business.
- reduces costs of transporting/dealing with cash
- improves bookkeeping and paper work
and it gains revenue by dealing with people who don't use cash. A large number of customers don't make routine purchases with cash, and these are higher income customers.
So the choice isn't "pay 3% on X or don't pay 3% of X" The choice is "pay 3% on X" or "don't pay 3% on .9X".
Debit cards circumvents the need for cash as well and are much cheaper. Everyone uses debit cards where I live, cash is very rare so companies doesn't need to deal with it much.
So the difference is really just a straight 3% vs 0.15% with no other consequences.
This seems to show the fees can be considerably less than 3%, although PayPal or Square will charge nearly that:
https://www.fool.com/the-ascent/research/average-credit-card...
https://www.mastercard.us/en-us/business/overview/support/me...
Using a credit card is borrowing money. Interest rates have to be disclosed.
So the fees plus the grace period are a way of making it look like typical card users are not paying a lot of interest.
People getting cash back are actually paying low interest rates, because the market dictates it.
If the fees were prohibited, then not much of substance would change, except the numbers would all be higher.
I'm not sure why Americans say that credit cards with 3% fees would be better than this system, and make fun of Europeans for not wanting to use credit cards. To me it just feels like US finance industry tricked everyone into choosing the more expensive product since they hid the costs of it from the person making the choice. But when people has to pay the real costs of credit cards then basically nobody wants one.
I believe there is an opportunity cost for not using a credit card in US: you don't build your credit history. This might leave you disadvantaged in the future because... the finance industry (as an extension, the society) is structured in a way that you must have a good credit history.
But you have a point with circularity and arbitrarity. Credit is basically about trust, and the thing with trust is that you already need trust to build more trust. When do you start trusting people to take loans is just as arbitrary as when a person attains the age of majority.
I don't know if you're trying to characterize my remarks above, but if so, this is inapposite.
I claimed the fees were a shell game, which implies having them isn't significantly better or worse.
If they weren't hidden, it would be clearer how much interest was being paid, but people who pay a low rate would probably still want to borrow.
I do feel like there is more fraud protection with credit cards as they currently exist, which is not to say that is specifically tied to a detail like fees not being regulated.
It seems all around logical and reasonable to me to want to pay a few basis points more in fees in exchange for fraud being someone else's problem. It's not just a fee for service, but also aligning incentives.
If your bank can take the position that fraud is (virtually) impossible, that's not just inconvenient when you happen to be an unlucky victim, but it minimizes their motivation to prevent anything that contributes to it.
Yes, someone is paying for my 2% cash back card but it’s still a net benefit to me.
We (anyone/anywhere) could pass a law that said no more fees, and the credit card companies could instantly raise interest rates and end grace periods to compensate exactly. And then instead of cash back, they would have cards with much lower rates.
I don't see that anybody would be better or worse off, to first order. The difference is framing, and psychological response.
People look at stuff totally differently when it's divided into different buckets.
I don't think you can simplify it that much. If you end grace periods, the people that currently don't pay interest will suddenly be charged huge amounts. If you drastically lower the interest rates to make their costs match the old model, then other people that pay the card off slower will suddenly be paying much less than before.
It's easy enough to ban fees charged to the business, and force them to be charged to the customer, to make pricing more transparent and remove the silliness around rewards. But trying to replace fees with interest rates doesn't work, unless you set up some crazy nonlinear '''interest rate''' calculation.
They will be charged the same amount if the interest rates are set accordingly, it will just be explicit.
>other people that pay the card off slower will suddenly be paying much less than before
You say that as if their rate must remain, if not fixed, in a fixed ratio with others. I don't see why.
>trying to replace fees with interest rates doesn't work
You might be right. But I don't see why, and I think that if I can guess a little, people in the industry know much more and are smarter.
How do you turn that into an interest rate? Stuff at the start of the month and stuff at the end of the month are going to pay interest for different lengths of time. What if they change the timing of purchases?
Let's say you pick an average you're satisfied with. Okay, now you've calculated a rate you need to charge for the first month to match the old fee. You have to charge this specific percentage for the first month to make the math work out. ...but what if that percentage doesn't match the percentage you used to charge after the grace period?
One way to resolve this is to charge a first-month interest rate and a subsequent-months interest rate. But that's not really an "interest rate" anymore, is it? You're just obfuscating the fee, and the goal of this exercise was to make things more transparent.
The other way to resolve this is to have the "interest rate" change every single month, based on the timings of when you did all your purchases. This is just taking the old system and hiding it inside a black box, and that black box spits out an "interest rate" each month.
Unless I'm grossly missing something, there's no way to use just an interest rate to emulate a system of upfront fee plus interest rate. Do you have a suggestion of how to make the math work? Tell me what interest rate could replace "2% fee, 1 billing cycle grace period, 16% interest afterwards". Also tell me what interest rate could replace "0.5% fee, 1 billing cycle grace period, 16% interest afterwards".
If a grace period is ok now, why would it not be ok?
But if there has to be one rate per customer, sure, fine, why can't it be adjusted based on their minimum balance over time?
>Tell me what interest rate could replace "2% fee, 1 billing cycle grace period, 16% interest afterwards"
Option 1 would be to add (for the sake of an example) 24%, keep a sort of grace period, classify people in two groups.
People who were eligible for 2% cash back now pay 0% during the grace period, 16% after.
People who were not eligible for cash back now pay 24% during the grace period, 40% after.
Option 2, if they want to get rid of grace periods, they just separate people who usually pay off their balance monthly and those who usually don't and charge them the different rates.
Grace periods are fine! But you said get rid of them, and I was pointing out that you can't simplify the math that much. It ends up being a mess with a hidden grace period inside a bunch of confusing math, rather than an understandable and relatively stable interest rate.
If you're happy to keep grace periods, great, let's do that. And I'll skip the rest of the post because it's not worth fussing over in that case.
I use a debit card for groceries and such. However, just to be sure, my paycheck goes to an account with no cards attached. I then transfer small amounts ($100 or so) every now and then to the debit card account.
This limits my exposure to card fraud, and also has the nice side benefit of giving me back some of that "spending feeling" that cash has. If I have to transfer say three days in a row it's noticeable and I can think about what I've spent it on, and maybe slow down a bit if I know I'm running low.
Sure was an awkward call with the USAA security department after they worked out the exact timeline and actions of the attack. They didn't really have much to say in their own defense. Cost them about five grand in the end. The really annoying part is that now if my wife needs to call them for anything on the phone they make her jump through many hoops to identify herself. E.g. she has to answer the credit bureau-based questions every time, plus a PIN, plus a phone password. We may move banks just so we're not stuck with an online-only relationship because of this experience.
Paycheck to cards not attached does not matter, ACH transfers can still be done much easier vs a EMV/Stripe read of a debit card.
So all you are doing is amplifying your risk without any reward.
Only using it on gas & groceries, will average 16 points per dollar (approx 12-16%) when we reach $15,000 spent total.
The new deal is similarly structured but horrible in comparison, “shop small” is the category so it’s not realistic to max out the bonus spend without overspending.
There are some edge cases where one might overdraft more (delayed transactions IIRC), but again no fees.
But a lawsuit might untie them. That said fraud can sometimes be too hard to prove.
I'd paid with a credit card, so I asked my card provider to do either a chargeback or section 75 (I forget which) to force a refund, and the money was back in my account within a couple of weeks.
Any other cards anybody can recommend?
Sort of.
Do they still require using Chrome for that feature?
Fuck Google, I'm not about to use them for that!
I had a debit card saved on Aliexpress. The account was compromised by unknown means (maybe public wifi). Someone bought several $1,000+ phones from China that shipped to me in the US. I presume the sellers were in on it and were selling me unwanted inventory at inflated prices. Because they had tracking information, my bank (HSBC) said their hands were tied and I lost several thousand dollars overnight. It didn't matter that it was obviously fraud -- I provided customer service emails, logs showing the purchases all happened at 4am local time, and all at the exact same timestamp.
Moral of the story: don't use debit cards, don't save your cards online (save them in your browser and unselect "save this card"), don’t expect your bank to have effective fraud detection, and don't trust Aliexpress to have your back.