Uhhh… how exactly were these transactions supposed to even take place without the banking system?

I have no interest in bartering or sending ounces of gold around.

And don’t say crypto - last time I tried to figure it out, I ended up sending ETH, and more than half of it evaporated in “gas money”. What a joke.

I have a similar reaction.

If you want to go all the way into the consumer value matrix - Has anyone on HN ever had much a 2nd thought about whether or not their card would 'just work' out in the world?

I used to work in the actual room where acquirer links were monitored in real time 24/7/365. At least 8 people were in that room at any given time. I've never worked in nuclear power but I imagine you could draw some parallels.

This kind of reliability is not cheap or easy to come by. There isn't a clever technical trick you can employ to realize it. The only way to achieve the kinds of reliability we have in the world today still requires lots of human involvement throughout.

Does anyone dream of having a google-style support experience next time they are standing in line at the grocery store? This is basically what you are demanding when you say you want zero % fees on all transactions.

The history of payments and banking is amazing.

It’s always been a hard problem to solve, and the bankers who solved it always got paid handsomely for enabling commerce.

In the old days everyone bartered. Then came shells. Then precious metals. The gold had to be literally shipped around. Everyone from the Roman to the British empire had to physically ship chests of gold to it’s soldiers. Cross border commerce was absolutely fraught with risk. Piracy and shipwrecks galore.

Then the Rothschilds opened the first international bank, dramatically cutting the difficulty and expense of international trade.

We got cheques, paper money, and the credit card control room you worked in.

At every step, it got faster, cheaper, safer, more ephemeral. Trade increased dramatically. It’s amazing! The much-maligned banking sector is really a triumph of capitalism.

In the old days, even with the existence of precious metals and coin-based currency, a more community driven "help your neighbor" system thrived, moreso than a tit-for-tat system of exchange prevalent today or even theorized in the barter system.

> The much-maligned banking sector is really a triumph of capitalism.

Yes, the triumph of "what's in it for me".

You should indeed ask yourself that very question: what's in it for me?

Do you want to send little bits of gold and silver all around the world, or would you prefer modern banking? The choice is yours, pick the one that's best for you!

Another innovation is JPM coin, which is technically a cryptocurrency, and they're using that to power their internal international money movement systems.

Well there’s the FedNow Service which will introduce instant payments. Should eliminate the need for parasitic credit card processing networks.

A good “FedNow” or instant payment provider can easily disrupt the debit and credit card processing companies. At most, businesses charged 5-10 cents per transaction.

No more dealing with credit card network fees. Chargeback fees. Exchange fees. Issuing bank fees. Premium card fees. Just a simple 5-10 cent per transaction. Only need a US bank account.

I live in the UK, where we've had instant, free, interbank payments for the last few years (we've had free interbank payments for > 10 years, but the instant part came in a few years ago as part of the Faster Payments scheme).

Spoiler alert: it has not eliminated the need for credit cards. The credit card system has a lot of flexibility and integrations to make for a superior user experience in a number of situations. For example, a lot of banks let you create virtual cards for specific purposes (eg: I have one for all my online subscriptions, and another for merchants I've not dealt with before). Not to mention Apple/Google Pay and their integration into basically every single online payments platform.

Great, so it only works in a single country. Stripe supports much more countries and payment rails than just US credit cards.

You chose the most expensive "routing", otherwise you would only have spent cents to send any amount.

Knowing that is part of “figuring it out”. A lot of people wouldn’t expect something that harsh to be possible and/or don’t keep up with news about gas fees. A mistake that will never be repeated but a mistake most of us have done the first time.

The first and last time I'll ever pay "gas fees". I can wire arbitrary amounts around the world for a fraction of that gas fee with the full backing of the global banking system.

Next time you buy food, remember that's traditional farming system taking money out of your pocket.

Seriously, if the whole crypto scene taught us anything, it was that a global transaction network isn't an easy service to provide.

Well i learned a different lesson. It's now extremely easy to set up a global transaction network, or you can choose from one of the thousands of existing ones. Maybe you mean the regulatory aspect, not the technical?

> Maybe you mean the regulatory aspect, not the technical?

Both... but also neither. I meant mostly the marketing aspect. Or for a better word, prestige aspect. People really hate crypto as online cash. Examples:

1. Patreon has held a poll about what new features to add [0]. Crypto was the only feature the creators actively voted against. Note that for creators, crypto means one more way to receive money.

2. My anecdote: I was in a discord group where one member commissioned a short animation from another. They're from different countries and the commissioner couldn't use paypal (for some reason) however. I suggested USDT and explained how to convert it from/to fiat.

They ended up using international wire transfer (fee: ~$30).

3. Any HN thread when you mention crypto.

[0]: https://news.patreon.com/articles/the-first-ever-patreon-cre...

> It's now extremely easy to set up a global transaction network,

Yup. Wake me up when any of them actually does the amount of transactions Stripe and Shopify [1] do. Real transactions.

> Maybe you mean the regulatory aspect, not the technical?

"Both. Both is good".gif

[1] Their dashboard discussion is here: https://news.ycombinator.com/item?id=38403891, the dashboard itself is https://bfcm.shopify.com

Ridiculous considering India's NPCI processes $6B USD in 400M transactions a day at a modest operating revenue of < $0.5M USD a day!

This is a clear situation where the market is inefficient.

NPCI is state funded and runs at a loss. i.e. your taxes are paying for it.

They're definitely not running at a loss, 40% profit margin in fact.

It's also not the full picture to call them state funded. They're owned by a consortium of banks, both private and public. While the state maintains a level of ownership through their equity in public banks, the company itself is self- sustainable from an operations point of view.

Sorry, I meant that UPI is running at a loss and is subsidized.

https://bfsi.economictimes.indiatimes.com/news/fintech/upi-t...

The government gives Rs 1,300 crore as subsidy

Unsurprisingly, there is now a 1.1% interchange on some UPI transactions now: https://www.onmanorama.com/news/business/2023/03/31/upi-tran...

Separately, NCPI's revenues are USD ~2B/year: https://www.icra.in/Rationale/ShowRationaleReport/?Id=122149....

"We reserve the right to charge you for using the system we created and enforce through monopoly government force!"

A lot of the fee goes to the customer's bank that funded the transaction, which is what enables Credit Card rewards programs. If you limit that fee (like the E.U. has), Visa et al. don't go out of business, but then you won't see any similar level rewards programs like we have here in the US (e.g. 2% back on everything, or 3-5% on specific categories, etc).

At this point, every local restaurant in my area is charging 2.9% fee for using a credit card. Let's just lower these processing fees, get rid of credit card rewards, and small businesses can stop charging fees for using credit cards for payment.

Such fees just encourages bad incentives. Such as terrible security because reimbursing people / financing organized crime is cheaper (cheaper for the bank, of course much more expensive for society).

What? Financing organized crime? How does that relate to credit card processing fees?

Sloppy security in favor of reimbursement is financing organized crime.

Though how credit card processing fees relate to sloppy security is mostly a brainfart by me.

Is it just me who'd prefer they just didn't take my money in the first place...?

There's plenty of things about modern finance you're free to complain about. Things we're largely forced to do with onerous and useless fees attached - Realtors taking 6% of multi-million dollar transactions for doing nearly nothing has been in the news recently.

Pretty sure nobody is forced to buy info products on Black Friday for an 80% discount.

>and enforce through monopoly government force!

???