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Comment by sinker | Hacker News Reader

Credit card companies are essentially charging a rake on the consumer economy. They provide a valuable service, but skimming every transaction and funneling it into a handful of private companies is a net detriment for the vast majority of society. They've been at it for decades. First-mover advantage. Entrenchment effect. When CCs are integral to the transaction of money, it's essentially a tax on exchanging money. It's monopolies conducting parasitic toll collection.

Consumers shouldn't have to pay a fee to give someone money. Sellers shouldn't have to pay a fee to collect money. Security should be built into the system, not a luxury you're taxed for.

They should not be able to tithe all of society in perpetuity because they set up shop decades ago.

See also: the app store, telecoms, health insurance in the US

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> Consumers shouldn't have to pay a fee to give someone money. Sellers shouldn't have to pay a fee to collect money.

As I said, the fee you're paying if you use a credit card is for financial intermediation. That's not just "giving someone money" or "collecting money". There are other things included that have significant costs to provide.

> They provide a valuable service

And that means all your rhetoric about "charging a rake", "tax", "parasitic toll collection", "tithe", etc. is misplaced, because those things all imply that there is no valuable service being provided.

If you want to argue that there are ways to reduce the cost of the valuable service, for example by competition, that's one thing. But that's not the argument you're making.

> significant costs to provide

3% of transactions is an incomprehensibly large amount of cash. The systems that exist to transact cash have been in place for decades already. Major countries have already developed their own payment systems because they understand the problem and the cost to society. Most of these are entirely free and AFAICT, they work just fine.

> for example by competition

Sure, if you set up a time machine. Even in that case, there would be no meaningful competition. Someone else would simply occupy the position in the middle of the intersection instead.

"Parasitic" and "toll collection" remain accurate descriptors. What about "entrenched" and "monopolistic"?

Also, even if we strictly looked at the credit side, 3% take is arguably still too much now, even if the mechanics back then did justify the 3% fees. This is why regulators everywhere are now capping fees because the manual "send the imprinted invoices to then sort and get payment" is no longer there (and why they are eager to make fraud harder, unlike the post-facto system that exists in the US)

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