I've thought the ideal (from a fairness point of view, not "let's keep the banks' profit intact" point of view) model would be to have cut fees significantly (in the 0.5% area), eliminate rewards (again, merchants in competitive markets will lower prices accordingly), and eliminate the grace period on credit cards. This will mean debit cards would be used day-to-day by most people, and credit cards only when the financing is actually required (not as it is now where many, including myself, use credit cards for everything due to the rewards and pay in full). I prefer this to the current system of merchants paying inflated fees, which are passed onto us in higher prices, and rebated back to us by credit card companies (after taking their cut of course).
Re:Apple is propping up a fundamentally broken payments indu...
by pktgen on Friday September 12, 2014 @01:46PM
(#8309337)
Not necessarily terrible for cardholders, in competitive markets. Comcast won't lower their rates to account for the lower credit card fees but all the grocery store chains probably will, since they have to compete with each other.
The only argument that you can really make is that the issuer cut needs to be trimmed in which case rewards/loyalty cards would mostly go away. Good for merchants, bad for issuers and terrible for cardholders.
A payments network on the scale of V/MC that has worked near perfectly for over 50 years is far from "fundamentally broken".