13:27 She isn't wrong. Accepting cash is expensive. I worked at McDonalds for 2 years in college: 1) All the cashiers had to be trained to use a register, get use to counting out change 1b) Anything involving human's results in errors. 1-2 dollars per employee per day is a lot more than transaction fees 2) The manager spent 45 minutes to an hour balancing the books every night 2b) Swapping out the change in the register takes time 2c) Running out of change is always a problem 3) Being "short" whether actually or on paper consumes a ton of time to figure out 4) That cash has to be securely stored and transported With digital only: No more mistakes, instantly balanced books, no more cash storage logistics. Additionally, you increase customer through put
Agreed. I get that merchants dislike swipe fees (duh) but the alternative (cash only) seems so much worse. Average Walmart store does about $125,000 of sales per day. 2-3% swipe fees seem relatively cheep compared to trying to move that much physical cash around every day, ensuring enough change in the drawers, and as you mentioned, just trying to keep track of it all is a huge burden. I've basically stopped shopping at places that charge extra for credit card purchases. I'm like, fine, you don't want to provide me with convivence? I guess you don't want my money. I'll go elsewhere. The only major problem I see with credit card fees is that they use a lot of those fees to pay card holders with miles, points, cashback etc, which is a nice perk that people who don't have the credit to get these cards, or are "underbanked", basically get screwed out of for being poor or having bad credit. Like they say, "it's expensive to be poor."
Out of all the interviews and points raised in this video, Lisa Ellis' views seems the most balanced. Because she mentioned that yes, Visa's payment processing fees can be expensive, but so is cash, and cash processing can even be much higher. She also touched on the point of consumers benefitting off the convenience of swiping a card instead of paying in cash. What however, is totally missing from this video is regarding the additional sales that card payments and other cashless payments bring to a business. I mean, it is very common sense to assume that businesses turn to card payments like Visa (well, in this case, Visa is mentioned because it is the most successful company in the card payment processing sector, just like Microsoft for commercial OS, Amazon for e-commerce and so on), because it helps increase sales. Some people don't carry much cash on them, so if a business only accepts cash, that would mean lost sales, or opportunity cost. Also, there's the concept that people spend more using cards than cash, because of they don't feel the impact straight away. There's a lot to this in the realm of psychology. One thing though, is that because in most industries where there are highly successful companies especially with homogenous products/ services, there usually exists some sort of dubious practices, and it's these that need to be stamped out. One other thing that is obviously not mentioned is Visa's fees compared to other close competitors, in cold hard figures. Nope, all we hear at the beginning of the video is how Visa's fees are too high, second highest expense line in the P&L after labor, and so on. Interesting, to compare payment transaction fees with labor. For one, how much revenue and transactions does the company have? And actually, it's possible for transaction payment fees to be above labor, it all depends on the scale, nature of business and business model. Overall, this is quite an interesting video, though more context needs to be given in order not to mislead some viewers.
Agree on your point about how Visa enables consumers to buy things. A lot of times, the consumer will not really bring too much cash with them to purchase something unless they specifically planned to buy something. Impulse buys are tempered by how much money a consumer has and how easy it is to access an ATM. There's also the fact that the ability to pay off purchases via monthly installments also enables consumers to buy more (and more expensive) things. This is an inherent value brought by Visa and other credit card providers.
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be
Amazon doesn't have to compete, they can negotiate swipe fees with both networks just because of how massive they are. Small businesses don't have that bargaining power.
@@kavipatel298 Exactly. All big retailers negotiate lower swipe fees. Costco, for example, only accepts Visa at their warehouse locations because of their deal with Visa.
I'm not sure where they get 10% as the cost of a transaction. In 2015, I was running a company that took credit cards, both by a merchant account and by PayPal. Using a merchant account was about 2.9% of the transaction +30c, but there was a $25 minimum in transaction fees.The highest % cost was PayPal at 3.3% of the transaction +30c and no minimum. The only way it could be near 10% if they mostly have card transactions of $3 or less. I don't understand how they get 10%.
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be and if they ask tell that person off
@@punchingcrow5486 actually i am thanks dont act like Europe decentralized energy grid isnt a work of pure genius when you think of what it can be same with all the block chain encryptions on programs i can give you a portal into your work and im still in full control of all the files and data there even if you get hacked
It’s simple. Most of the top rewards card are VISA. Master Cards do have some rewards options but they tend to be on the lower end. Top Cash Back and Travel Rewards are VISA. Premium cards that compete with American Express Gold and Platinum for high rolling Businesses people, it’s gonna be a VISA.
@@gagan4127 Same here.. Initially I was little worried because sometimes bank server is down.. But now I put some money in paytm bank and my anxiety is over now. 😅
@@anchalshukla1 You mean paytm’s own savings account? And If so can you please tell me what are the transaction declining chances due to server problem in paytm bank?
@@vedahlawat In paytm I never faced problem..I usually faced problem in my HDFC account ..Sometimes HDFC sever is down for few hours..So for the emergency I use Paytm bank account..But right now it is fine for few months.
I appreciate all the content CNBC is producing from the stuff about the Auto industry, to this, to the thing about BlackRock, and supply chain shortages, it's all great.
When I traveled to Australia in 2012, the merchants passed the swipe fees on to the consumer which served as a great disincentive to using credit. I'm sure that helps keep the swipe fees reasonable as the consumer sees them.
I went to a local Chinese food restaurant to buy a $7.00 meal. When I looked in my wallet, I realized that I only had $5.00. Since I also had my credit card in my wallet, I told the cashier that I will pay with my card instead. The cashier then told me that the price of the meal would now be $9.00. When I asked why the price change, she said it was because of taxes. I believe what was really going on was that restaurant was passing the fees on to customers whenever they used credit cards. I never been back to that restaurant since.
@@zahedah80 It happens in Canada everyday. Silver Gold Bull is a bullion dealer in Alberta that has different prices depending on how you pay. Interac is cheaper than credit card.
It's a good point about cash. I think it's why so many small businesses are going cashless. They don't have to worry about theft, storing/counting money etc etc. I bet it costs big retailers a ton of money to maintain the cash portion of their payment ecosystem
The only smal businesses that are going cashless are the ones that tend to be in shitholes filled with crime making a lot of revenue and also it doesn't cost 15% of revenue to manage cash as it does to pay those fees.
@@johnbork7053 that's great. Distribute the money from rich white families to poor families in India! (Similar to what the British did to India during its colonisation.)
0.25% on the transaction, not the margin. If you have a 2% margin, you would see a eighth (12.5%) of that margin going to transaction fee. Some products are sold with a very small margin, so they can compensate with a higher volume of sales, and 0.25% can become a problem.
@@_Athanase_ Yes, this is where some cryptos are being proposed to be used. Some of the newer networks have extremely low fees and settlement times of seconds.
@@JohnSmith-ox3gy I don't think crypto has any use as a fiat currency. Working in a legal environment, a centralized banking system is much preferable to a decentralized one, especially for commerces.
Consumers rather swipe than carry around cash, or having to go to an ATM. Consumers also get a chance to earn points/ cash back features if they use their credit card. Along with protection and being able to purchase items without actually having the dollar amount at the moment. Consumers prefer the convenience and worry free ability to pay for an item/service. I myself carry some petty cash but 95% of my purchases are done cashless. Also cash is quite dirty and delicate at the same time.
@@ManishKumar-eh4ol using it for free is. There are already charges made by banks for over 20 P to P transactions. And there is a cost to the banks every time money is moved, so they can't keep the fees zero forever.
But the merchant gets paid when ? In 30 days? And paying 3% to lend that money to visa. But When you borrow from visa they charge 10% minimum. Visa should pay the merchant either right away or 5% extra for holding the money. Not this I pay you to borrow my money business.
@@johnsamuel1999 Yea , and I’m saying that when you owe them money they charge over 10% , but when they owe you money they still charge you 2-3% . Instead of giving 1-2% extra on what they owe the merchant.
Not really. Fees eat up a big part of a small biz profits. The average small business makes around a 5-10% profit margin off the revenue. Fees could be anywhere between 1-5% of the swiped amount. As they said at the end. Handling cash could be even more expensive for the merchants.
during the pandemic, the additional processing fees that Visa levied were especially crippling to small businesses. When there's a financial crunch, Visa profits soar, while everyone else struggles.
This is why Visa and Mastercard arent’t accepted in any non-tourist shops/locations in the Netherlands. Maestro is the only one with reasonable commisions
Interestingly many restaurants in my city have stopped accepting cash as a payment method (this is before covid) because the cost of accepting cash it higher than card. On the other hand where I work we're constantly switching payment providers or negotiating as it is a cut straight off of our margin.
If the bill comes and you have cash but no credit card, are they really going to refuse your cash? I can imagine them calling the police over this and the police see that you were trying to pay all all along with cash. If I were the server I would even offer to keep the cash from the customer and swipe my own card just to rack up the cash back.
@@mikehodge5251 I doubt a restaurant would call the police if you couldn't pay. I've forgotten my wallet before and just told the restaurant I'd come back the next day and pay. They were fine with that. One restaurant I go to has a sign saying there will be a $20 charge for cash.
All shops have the same problem "Oh the payment processing company is charging us so much. Oh the bank is charging us so much. Oh doordash and ubereats are cutting into our revenue so much" Yet no matter I pay with a master card on doordash or in person with cash, the price of food is the same. Make cash purchases that cut out the middle man cheaper and you'll see the middle men charge less. Simple logic
@@onieodelia5840 Yes of course it is! But i will say don't do it yourself if you are inexperienced. Go get yourself someone good you can trust or better still check out *Judith* *Mary* *Ballantyne* she's good too.
If I heard that right ...only .25 cents per $100 dollars. That is less than 3 tenths of a percent. They introduced a business concept. You don't have to accept cards. But people will shop where they do. They worked to get their business to that successful point!🎁🤑🎀
I liked this video a lot because it has people speaking in favour of Visa and against Visa, BOTH SIDES. Many of CNBC's videos feel one sided, almost like an extended ad for the company. Not this one. 👍
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be and if they ask tell that person off
13:20 Paying with cash isn't that big of a deal, to me at least. I went from living in an area where I exclusively used a credit card, to an area where I exclusively used cash.
Transaction charges are too high in the credit and debit card industry, and the participants that created the structure have no incentive or penalty to make the fees smaller or more ratio-ed toward fees based on transaction amounts.
The fee is not too crazy. It sounds like it's basically a robbery compared to what the digital signal cost to send, but handling physically isn't cheap either...
@@FreeminderXIII Exactly. It's pretty much all about convenience and it's easier to spend money you're not physically holding in your hand. But there's digital theft just as easily as there was theft/skim/fraud with cash. Pick your poison.
@@nczioox1116 There’s no need for them in crypto other than to have their trading desk speculate on NFTs. One of crypto’s goals is literally to make companies like Visa irrelevant. In the meantime it’s just a race to the bottom for who can just charge lowest fees with greatest adoption.
@@martinlutherkingjr.5582 Wish I could agree with you, but the biggest irony of crypto (that few fail to acknowledge) is that the majority of people in crypto dont give a damn about replacing the dollar, but instead are trying to flip crypto coins to make more fiat dollars.
As an indian i find it extremely funny how one of the most advanced countries on earth is still bearing card network company monopoly, whereas in india we have unified payments interface and IMPS, under UPI we can scan a QR which the merchant has and we can payment without any charges, its so successful that even small vegetables vendors have it and for bigger transactions there is IMPS, visa and master card were crying before US govt due to revenue loss and we also have our own govt corporation developed card network Rupay🗿
The superiority of digital over physical transaction processing is a redundant topic. How they've managed to maintain a virtual monopoly in the space is worth covering in more detail.
Indeed, their high profit margin tells you that the market is not "free". Technological advancement should have driven down cost to a fraction of what they are today. There must be massively anti-competitive practices being employed here, and probably a very high amount of political lobbying.
0.25% per transaction is much? I was expecting a MUCH higher fee... Think of the convenience, for both the customer and the seller. Imagine all digital, no money. No need to give change, no risk of counterfeit money. No risk of being robbed. No need to pay someone to get the money from the store and ship it to a bank. All for just 0.25%? Sounds like a great deal to me.
EU limited fees that can be taken for processing card payments to a fraction of a percent so I think U.S. could do the same. It really helped small businesses to start accepting card payments. I think U.S. also could limit those fees, the question is if the want to do this. Since Visa is an American company it would drastically lowered taxes the government gets from Visa.
If you are a business...and want to circumvent VISA or encourage other forms of transactions...It is simply...Some places if you use CASH or DEBIT then they give a 5-10% discount on the goods or services...Other places have started implementing fees to use a VISA Credit Card to cover transaction costs up to 5%. This is how you encourage customers to use cash, debit, or other services.
Sure swiping the card might be more "convenient" however, small businesses won't ever have to spend 15% of their revenue storing cash unless they're really not doing well at all. Use cash at small business and use a debit card or credit card at the bigger businesses people.
Now I understand why here in my country Indonesia every payment gateway provider charges a freaking 2.5% fee from the total amount of transactions for every Visa, Mastercard, JCB, and Amex debit/credit card. Damn I'm making these guys Rich AF
I knew there were fees on the seller's side for card transactions. I always thought it was for the medium, like the card reader or app.I didn't think there was more😩
Well, they can do that by adding it to the price of the product they sell without us knowing. Haha. It’ll be more beneficial for these merchants if their customer will pay in cash because that would translate as revenue on their part.
Happy to see VISA and Mastercard became unpopular in India 🇮🇳, and happy to see India's own payment gateway RuPay, diminish the dominance of VISA and Mastercard!!
I have a VISA card and I only use it with companies who refuse to accept Discover card. I moved from the VISA card to the Discover card when I asked both to decrease my card interest rates with Discover agreeing and Visa out right refusing to budge one millimeter.
Visa doesn't control your interest rates, they don't lend you any money. You are confusing your bank with your payment network - these are two different things.
@11:45 The charge in US is 10 % ? Wow that is really killing merchants, we only got 2% here, and even that most merchant pass that cost to the customer.
@@Bertuzz84People love convenience. So many people are still using cards at local businesses even if there's a surcharge because carrying and accounting for cash is more tedious than tapping a card.
I work on mobile where charge fees are currently 30% and negotiations are going only as low as 10-15%. She quoted .2% (though I thought it was closer to 2%) and it still causes small business issues. Why do we let these middle men take so much profit?
There’s little incentive for consumers because they are unaware of the fee so they have no reason to figure out how to use crypto. Merchants don’t want to risk alienating customers by only accepting cash and crypto. For the small businesses that survive the next 10 years, I think you’ll start to see more of them accepting Bitcoin lightning, stable coins and Monero payments. Just need older generations to die off.
@@glennpuystjens UPI is from NPCI(National Payments Corporation Of India) NPCI offers other products like Rupay,NEFT,RTGS,IMPS They make profit from these.
The Visa brand has become so synonymous that Ive never even considered how or why it came to be this way, just always was there but I became curious and this is fascinating.
With CBDC-s on the horizon the long term business case of Visa and others isn't looking so rosy. Right now it's a fantastic business of course, but it's still pretty much guaranteed that they will become redundant sooner or later, it's just a matter of when the public infrastructure will be ready to do the same job better and cheaper.
Card? No…Facilities transactions with their branded network on a card issued by financial institution, yes! Also it isn’t too much of our decision to pick Visa or Mastercard when you sign of for a bank, they just tend to all use Visa. And this bit of information was brought to you by American Express!
I'm just wondering here... what are small business owners going to do with the extra cash they'll save if for any reason we stop using our CC? Are they gonna pay employees better because if they are then I'll use cash, but most likely they'll just pocket that money.
The math, or perhaps the explanation of the math is poor. The initial lady said they made 25 cents on $100. That is 1/4 of a per cent Which is low. Yet business are charged in the 2 - 5 % range which means that 90 - 95 % of those fees are going to other parties. Will.we see a break down of thhow it gets split by the parties?
I have two Visa cards. Can’t remember last time I used it. Cards are becoming a thing of past in India. UPI is the new dragon. Btw for bigger transactions we Indians mostly use imps/neft from bank app’s. Cards may survive on credits cards
12:30 oh my god... she's actually so deluded... It is not remotely skewed in favour of the merchants. She's a senior equities analyst and yet she doesn't understand basic accounting. Merchants don't get earn their revenue from the banks. Merchants earn their revenue from customers. Banks simply facilitate the transaction. For there to be such a significant cost just to process the transaction is absurd. Paypal does the same thing for much less. The one differentiating factor which she didn't mention which would make her argument so much stronger, is that Visa eliminates credit risk for the merchant. By using Visa, customers are able to pay on credit which is a convenience and the merchant doesn't need to take on the risk that the customer won't pay later on. That still doesn't justify the high costs however. Visa can absolutely afford to reduce their fees but there is no incentive to do so because of the lack of competition.
That might be interesting to me, since my bank in the UK, NatWest, recently announced that they're switching the debit card provider from Visa to MasterCard, and this was revealed to customers via letter and e-mail.
The quality of this video by CNBC is not good. They should have done better research. The card processing fees "swipe fees" have three parts: Interchange fees This goes to ISSUING BANK, such as chase, BOA, NOT Visa/Mastercard. on average it ranges between 1.15% - 3.3% Assessment fees Only this part goes to the payment network, such as Visa, Mastercard, etc, and it averages about 0.15%. This is number I found online, but this video mentioned a similar number at 1:17. "A quarter for every $100" Payment processing fees This is paid to the company ("card processor") that accepts the credit card payment and sends the transaction to the payment network, either through a physical card reader or an online payment gateway. These are the companies that provide e.g. POS machines and software that process the cards. Fee structures vary considerably depending on the credit card processor you choose The total amount depends on types of card, business's MCC, and types of payment (physical or online). The percentage amount also depends on total sales of the business, as they are often charged some flat fees, and the more sales a business makes, the lower swipe fee in terms of percentage. AMEX usually charges the most, which is one of the reasons some businesses don't accept AMEX. These fees are also not charged for nothing. They have to for example cover, equipment costs, and the risk of fraud. Online transactions carry a higher risk of fraud and/or chargebacks, and interchange fees are often higher on these transactions.
That's why in my country India the govt has introduced "RUPAY" which is freely and securely maintained by the reserve Bank of India.... So both customer and merchant don't get ripped off by a pvt entity like visa
The US Federal reserve is technically a private entity already. It's owned in equal parts by the banks operating in the US. If we duplicated that it would go from one privately held monopoly to another.
The video is very misleading. The fees that the merchants complain about go to the banks not Visa. Visa makes a few cents per transaction. If the banks were to be forced to make less money, it would minimally impact Visa. Crypto in its present form cannot compete with Visa as it takes minutes for a transaction to complete as opposed to sub second for Visa. Also, when I last did the math a few years ago the cost of processing a crypto transaction was thousands times more than a Visa transaction. Fine for a speculative medium, terrible for actually buying things. There is a lot more to it than that, but that gives a flavor of the situation.
Like we Indians have UPI We literally kick out visa Visa debit cards totally wipe 😂🤣out I didn't even use card since UPI come 🤣 Us tech gaints suggesting US goverment to develop same system 😁 Which is so so realible Nd it was the reason now India Haha world's highest digital transaction over 25 bilion $ a year #2 China with near 15 bilion $ Nd thrid America 😁
@@polarbear7 Expect it is paid by taxes is my guess. Edit: Even worse the the fees start at 0.25% and grow upto 0.6% so it is not free. Wait, it is a bit more complicated.
@@polarbear7 you do know, VISA and UPI work on same platform, UPI charges commissions on companies that use their network, the differences are incremental and are better suited as a system to a developing nation where more than 200 million people don’t even have access to internet. Also the system allows for topping up with telecommunication providers and charges them a service so someone is still paying for the network, the charges are just different.
With billions of transaction per day the money Visa earns can add up. But banks and card machine companies actually take most of the fee because there are way too many of them, banks can't profit from a small margin. American Express, on the other hand, takes every penny, so they don't need to focus on card volume, and they don't need to beat Visa in card acceptance. They charge a higher fee and focus on ATV.
When I was young, I thought VISA is the same VISA required for traveling abroad.
it’s not the same organization? lemme google this real quick….
Ikr. So when all these ads require you to have a visa to travel, you go get the credit card. 😂
I actually misunderstood travel visa since I first knew visa as a (or the) credit card company
Lol me too
Yeah I did too. I knew it was a different kind of visa but I thought it was from the same company.
13:27 She isn't wrong. Accepting cash is expensive. I worked at McDonalds for 2 years in college:
1) All the cashiers had to be trained to use a register, get use to counting out change
1b) Anything involving human's results in errors. 1-2 dollars per employee per day is a lot more than transaction fees
2) The manager spent 45 minutes to an hour balancing the books every night
2b) Swapping out the change in the register takes time
2c) Running out of change is always a problem
3) Being "short" whether actually or on paper consumes a ton of time to figure out
4) That cash has to be securely stored and transported
With digital only: No more mistakes, instantly balanced books, no more cash storage logistics.
Additionally, you increase customer through put
But the gov can freeze your assets at anytime with any digital currency
Cash creates jobs, of course you won't mention that.
@@punchingcrow5486 I agree cash is king
Agreed. I get that merchants dislike swipe fees (duh) but the alternative (cash only) seems so much worse. Average Walmart store does about $125,000 of sales per day. 2-3% swipe fees seem relatively cheep compared to trying to move that much physical cash around every day, ensuring enough change in the drawers, and as you mentioned, just trying to keep track of it all is a huge burden. I've basically stopped shopping at places that charge extra for credit card purchases. I'm like, fine, you don't want to provide me with convivence? I guess you don't want my money. I'll go elsewhere.
The only major problem I see with credit card fees is that they use a lot of those fees to pay card holders with miles, points, cashback etc, which is a nice perk that people who don't have the credit to get these cards, or are "underbanked", basically get screwed out of for being poor or having bad credit. Like they say, "it's expensive to be poor."
@@punchingcrow5486 are you pablo escobar or something? You can’t hide all your money under the mattress or carry a brief case of cash.
I worked for Visa from 1983 to 2009. Just keeping up with growth was a full time job. It was one hell of a ride.
@michael Jordan Wait...didn't u played for Chicago bulls and Washington wizard?
Would love to hear more about your career.
@@bhilbert11 same
U play basketball with Chicago bulls while working with visa as part time job?
👆🏼👆🏼👆🏼 he did it again for me 🥰🥰🥰I got my love credit card delivered to my address second time 😊😊😊 best carder/vendor he dell&buy giftcard also
Out of all the interviews and points raised in this video, Lisa Ellis' views seems the most balanced. Because she mentioned that yes, Visa's payment processing fees can be expensive, but so is cash, and cash processing can even be much higher. She also touched on the point of consumers benefitting off the convenience of swiping a card instead of paying in cash.
What however, is totally missing from this video is regarding the additional sales that card payments and other cashless payments bring to a business. I mean, it is very common sense to assume that businesses turn to card payments like Visa (well, in this case, Visa is mentioned because it is the most successful company in the card payment processing sector, just like Microsoft for commercial OS, Amazon for e-commerce and so on), because it helps increase sales. Some people don't carry much cash on them, so if a business only accepts cash, that would mean lost sales, or opportunity cost. Also, there's the concept that people spend more using cards than cash, because of they don't feel the impact straight away. There's a lot to this in the realm of psychology.
One thing though, is that because in most industries where there are highly successful companies especially with homogenous products/ services, there usually exists some sort of dubious practices, and it's these that need to be stamped out. One other thing that is obviously not mentioned is Visa's fees compared to other close competitors, in cold hard figures. Nope, all we hear at the beginning of the video is how Visa's fees are too high, second highest expense line in the P&L after labor, and so on. Interesting, to compare payment transaction fees with labor. For one, how much revenue and transactions does the company have? And actually, it's possible for transaction payment fees to be above labor, it all depends on the scale, nature of business and business model.
Overall, this is quite an interesting video, though more context needs to be given in order not to mislead some viewers.
Most of the media these days is propaganda and the left wing view of things. Independent views like your post are censored out.
Agree on your point about how Visa enables consumers to buy things. A lot of times, the consumer will not really bring too much cash with them to purchase something unless they specifically planned to buy something. Impulse buys are tempered by how much money a consumer has and how easy it is to access an ATM. There's also the fact that the ability to pay off purchases via monthly installments also enables consumers to buy more (and more expensive) things. This is an inherent value brought by Visa and other credit card providers.
Visa charges very little to be honest. Most middle men charge significantly more for significantly less value
You work for Visa PR, huh
I totally agree with you. I dont see visa as evil as they see it.
Has CNBC finally started talking about finance companies instead of just Car makers, car brands, and shortages?
they should talk about Covid-19 brands who made the virus
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be
They’ve made a lot of finance videos before
@@roxaskinghearts literally nobody asked
@@ramasahoochandra8548 up yours too buddy
BlackRock and now Visa, I'm loving this session hopefully they'll continue and not start talking about cars again.
Amen!
you meant season right?
No one asked
@@andyadams9612 no one asked if no one had asked
upi is new tech💯💯🙌
I wouldn’t be surprised if Amazon tried to directly compete with both. The swipe fees of Amazon are probably on Bezos hit list
Possible, but every company on the planet views Amazon as a competitor for everything. They won’t accept any Amazon card.
Amazon doesn't have to compete, they can negotiate swipe fees with both networks just because of how massive they are. Small businesses don't have that bargaining power.
@@TheBooban good point
@@kavipatel298 tell that to fedex, ups, and the post office
@@kavipatel298 Exactly. All big retailers negotiate lower swipe fees. Costco, for example, only accepts Visa at their warehouse locations because of their deal with Visa.
I'm not sure where they get 10% as the cost of a transaction. In 2015, I was running a company that took credit cards, both by a merchant account and by PayPal. Using a merchant account was about 2.9% of the transaction +30c, but there was a $25 minimum in transaction fees.The highest % cost was PayPal at 3.3% of the transaction +30c and no minimum. The only way it could be near 10% if they mostly have card transactions of $3 or less. I don't understand how they get 10%.
They're probably referring to the margin. Eg. 1% fee on a 10% profit margin = 10% of gross profit lost to Visa fees.
Exactly! it's around 2-3% here in Canada as well
@@jordanb722 brilliant point Jordan.
Their fees are getting to be too expensive. I noticed that more and more of my card issuers move from visa to MasterCard. Especially chase bank.
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be and if they ask tell that person off
@@roxaskinghearts Keep dreaming crypto supporter
@@punchingcrow5486 actually i am thanks dont act like Europe decentralized energy grid isnt a work of pure genius when you think of what it can be same with all the block chain encryptions on programs i can give you a portal into your work and im still in full control of all the files and data there even if you get hacked
35 cents is to expensive ? Lmfao
USAA went from MC to Visa...
It’s simple. Most of the top rewards card are VISA. Master Cards do have some rewards options but they tend to be on the lower end. Top Cash Back and Travel Rewards are VISA. Premium cards that compete with American Express Gold and Platinum for high rolling Businesses people, it’s gonna be a VISA.
In India Government have their own alternative to VISA named "Rupay" and started UPI system to accommodate merchant transactions for 0 fees
@@gagan4127 Same here.. Initially I was little worried because sometimes bank server is down.. But now I put some money in paytm bank and my anxiety is over now. 😅
@@anchalshukla1 You mean paytm’s own savings account? And If so can you please tell me what are the transaction declining chances due to server problem in paytm bank?
@@vedahlawat In paytm I never faced problem..I usually faced problem in my HDFC account ..Sometimes HDFC sever is down for few hours..So for the emergency I use Paytm bank account..But right now it is fine for few months.
There are plans to add fees for UPI. Although not as much as visa but enough to cover the cost of operations.
I just realized ,I don't even carry Rupee banknotes anymore, all transactions done in online,
I appreciate all the content CNBC is producing from the stuff about the Auto industry, to this, to the thing about BlackRock, and supply chain shortages, it's all great.
Exactly. Fellas pretending cars and supply chain aren't an integral part of people's lives are fooling themselves.
If more people used debit cards, businesses would pay significantly less in swipe fees. It’s a huge difference between debit and credit fees.
When I traveled to Australia in 2012, the merchants passed the swipe fees on to the consumer which served as a great disincentive to using credit. I'm sure that helps keep the swipe fees reasonable as the consumer sees them.
Thats not allowed in Canada
@@zahedah80 it should be. If you want to use your credit card, then pay the swipe fee. If you want to save, then pay cash.
@@usr-qpwyg126 my point is that it is not just $0.25 like they reported
I went to a local Chinese food restaurant to buy a $7.00 meal. When I looked in my wallet, I realized that I only had $5.00. Since I also had my credit card in my wallet, I told the cashier that I will pay with my card instead. The cashier then told me that the price of the meal would now be $9.00. When I asked why the price change, she said it was because of taxes. I believe what was really going on was that restaurant was passing the fees on to customers whenever they used credit cards.
I never been back to that restaurant since.
@@zahedah80 It happens in Canada everyday. Silver Gold Bull is a bullion dealer in Alberta that has different prices depending on how you pay. Interac is cheaper than credit card.
Literally had an American Express ad for this video😂
... And that's not a coincidence..
It's a good point about cash. I think it's why so many small businesses are going cashless. They don't have to worry about theft, storing/counting money etc etc.
I bet it costs big retailers a ton of money to maintain the cash portion of their payment ecosystem
The only smal businesses that are going cashless are the ones that tend to be in shitholes filled with crime making a lot of revenue and also it doesn't cost 15% of revenue to manage cash as it does to pay those fees.
Those outrageous fees are exactly why I always use cash with store front small businesses.
Visa was popular in Kenya 🇰🇪🇰🇪🇰🇪 in the 2000s. But Mastercard has surpassed that by far.
Why though? Why is it losing fo mastercard
In india, i find it fascinating that upi (United payment interface) is fast replacing visa and MasterCard as most preferred mode of payment.
Here in Brasil, PIX is doing the same
Easier scam call centers payment.
@@johnbork7053 that's great. Distribute the money from rich white families to poor families in India! (Similar to what the British did to India during its colonisation.)
It's not United , it's unified payments interface.😅
I was looking for this comment😂
I only use visa because it was issued to me by my bank. I didn’t chose visa, visa chose me
Same...
Introduce unified payment gateway. The government in india did that. It's going to disrupt the monopoly.
Yeah the UPI implementation is way better than I expected it would be. The dependency on cards and online banking is reduced drastically
Smart. No reason why it shouldn't be done, the technology is there.
@@streamingtv7200 can you link something where I can better understand what it is?
or use nano, feeless global payments with no limits.
visa and mastercard both will die because i don't know why i am forgetting atm pin everytime after using UPI
If VISA makes 25ct per $100 that is 0.25%.
To me that doesn’t seem excessive.
It’s the banks that overcharge.
0.25% on the transaction, not the margin. If you have a 2% margin, you would see a eighth (12.5%) of that margin going to transaction fee.
Some products are sold with a very small margin, so they can compensate with a higher volume of sales, and 0.25% can become a problem.
@@_Athanase_ Yes, this is where some cryptos are being proposed to be used. Some of the newer networks have extremely low fees and settlement times of seconds.
@@JohnSmith-ox3gy I don't think crypto has any use as a fiat currency. Working in a legal environment, a centralized banking system is much preferable to a decentralized one, especially for commerces.
@@JohnSmith-ox3gy
Not only that, but with the Lightning Network, you pay fractions of a cent for each transaction. Bye, bye Visa!
@@_Athanase_ why?
Consumers rather swipe than carry around cash, or having to go to an ATM. Consumers also get a chance to earn points/ cash back features if they use their credit card. Along with protection and being able to purchase items without actually having the dollar amount at the moment. Consumers prefer the convenience and worry free ability to pay for an item/service. I myself carry some petty cash but 95% of my purchases are done cashless. Also cash is quite dirty and delicate at the same time.
Here in India UPI transactions are around 3 billion per month , that too without any charges 🌝
Nope, there are limits on free use, and they are going away, fast.
@@bindingcurve yes right! Lol
@@bindingcurve I use it as my primary payment method , never had to pay any charges , it's not going away anytime soon 🙂
You cannot transact more than a lakh through UPI. 😅
Same is not the case with debit cards
@@ManishKumar-eh4ol using it for free is. There are already charges made by banks for over 20 P to P transactions. And there is a cost to the banks every time money is moved, so they can't keep the fees zero forever.
2-3% fees to not have to deal with the logistics of dealing with cash is a bargain. No logistics, no human errors, and a wider consumer base.
But the merchant gets paid when ? In 30 days?
And paying 3% to lend that money to visa.
But When you borrow from visa they charge 10% minimum. Visa should pay the merchant either right away or 5% extra for holding the money.
Not this I pay you to borrow my money business.
@@darthdaddy6983 they dont charge 10 % not idea where they got that figure
@@johnsamuel1999
My visa CC has a 10.99% interest rate,
@@darthdaddy6983 no they are talking about the sales commison not the interest rate for not pay the amount
@@johnsamuel1999
Yea , and I’m saying that when you owe them money they charge over 10% , but when they owe you money they still charge you 2-3% .
Instead of giving 1-2% extra on what they owe the merchant.
It's strange because in Canada lots of places now only accept mastercard. Visa used to be the no.1 in Canada.
MasterCard has the cheapest fees compared to any other big corporate payment network.
And as of today, VISA remains one heck of a company, a great long-term investment with a long, long, lifespan ahead of itself!
Hmm, have you heard of CBDC? That basically state issued crypto. China already started it. If it catches on visa is done
This aged like milk, but a good time to buy more
@@thunderb00m lol @ visa is done
I have a feeling that some of the shops probably just want the cash since it's much easier to hide that revenue from the tax man.
Not really. Fees eat up a big part of a small biz profits. The average small business makes around a 5-10% profit margin off the revenue. Fees could be anywhere between 1-5% of the swiped amount. As they said at the end. Handling cash could be even more expensive for the merchants.
Title: How Visa Became The Most Popular Card In The U.S.
Should be: How many legal challenges does Visa settle everyday and still survive.
"This is fine."
- Visa
during the pandemic, the additional processing fees that Visa levied were especially crippling to small businesses. When there's a financial crunch, Visa profits soar, while everyone else struggles.
“Their fees are getting to be too expensive.” That’s the cost of doing business. Just don’t call it taxation.
This is why Visa and Mastercard arent’t accepted in any non-tourist shops/locations in the Netherlands. Maestro is the only one with reasonable commisions
The funny thing is that Maestro is owned by Mastercard.
Maestro is own by Mastercard?
@@mitchellquartero yup, u can see their logo is pretty much the same as well
@@pranav7471 exactly
Interestingly many restaurants in my city have stopped accepting cash as a payment method (this is before covid) because the cost of accepting cash it higher than card. On the other hand where I work we're constantly switching payment providers or negotiating as it is a cut straight off of our margin.
If the bill comes and you have cash but no credit card, are they really going to refuse your cash? I can imagine them calling the police over this and the police see that you were trying to pay all all along with cash. If I were the server I would even offer to keep the cash from the customer and swipe my own card just to rack up the cash back.
@@mikehodge5251 I doubt a restaurant would call the police if you couldn't pay. I've forgotten my wallet before and just told the restaurant I'd come back the next day and pay. They were fine with that.
One restaurant I go to has a sign saying there will be a $20 charge for cash.
All shops have the same problem "Oh the payment processing company is charging us so much. Oh the bank is charging us so much. Oh doordash and ubereats are cutting into our revenue so much" Yet no matter I pay with a master card on doordash or in person with cash, the price of food is the same. Make cash purchases that cut out the middle man cheaper and you'll see the middle men charge less. Simple logic
Cash will be banned eventually, we also need digital alternatives without middlemen.
In many places it's illegal to charge different rates for cash vs credit.
Ah Visa. The reason gas stations charge 10 cents more per gallon when you use plastic.
I wish regular news also presented both sides
People be kicking themselves in months for not investing in Stocks or Cryptto, Real Estate is good also but a little complex.
Are stocks really that profitable? Heard so much about the volatile market. I might be wrong anyway.
@@onieodelia5840 Yes of course it is! But i will say don't do it yourself if you are inexperienced. Go get yourself someone good you can trust or better still check out *Judith* *Mary* *Ballantyne* she's good too.
Living off Nasda stocks currently. It's fun!🤣🤣🤣🤣
What are your thoughts on ETFs and Stocks with dividends?
I totally agree with you...being holding health for years.
Постоянно чиллю под твои видосы)) снимай почаще!😅
VISA no longer accepted at many large businesses in the Netherlands and it is confusing and frustrating.
Wait for sometime when Rupay card 🇮🇳 will have most transactions in terms of volume and value. Indians hit like 🇮🇳🇮🇳
Yeah ok 🙄
If I heard that right ...only .25 cents per $100 dollars. That is less than 3 tenths of a percent. They introduced a business concept. You don't have to accept cards. But people will shop where they do. They worked to get their business to that successful point!🎁🤑🎀
for customers, for merchants it's a different story
I liked this video a lot because it has people speaking in favour of Visa and against Visa, BOTH SIDES. Many of CNBC's videos feel one sided, almost like an extended ad for the company. Not this one. 👍
Hope they start talking about real investing and Vanguard... one day :)
Keep going, I hope you don't stop. I'm a VIP subscriber with you. I love you🐴
In South Africa we use Visa and MasterCard.
No one cares.
master cards are trash there support is in africa and then give them a ability to give a instant refund to the card and resell it to 3rd party resellers dont tell anyone your card number ever over the phone even if you are finding the card isnt working like sold to you should be and if they ask tell that person off
Yup. I'm a MasterCard kinda guy myself🇿🇦
@@ecognitio9605 yet u comment
The US is lagging behind asia in payment system. In Asia, mobile payment is so cheap. I just need a VISA card because I need it for traveling.
Americans still use checks, a thing that no one uses here in Brazil since early 2000s.
D G America is the the land
Of the free that’s why
America is lagging behind so many countries in so many things...
We have had feeless tap and go payments available since 2018, shame more people don't know about Nano yet.
13:20 Paying with cash isn't that big of a deal, to me at least.
I went from living in an area where I exclusively used a credit card, to an area where I exclusively used cash.
Transaction charges are too high in the credit and debit card industry, and the participants that created the structure have no incentive or penalty to make the fees smaller or more ratio-ed toward fees based on transaction amounts.
The only time trans fees lower is when it is profitable to lower them
Which is not easy to happen
The fee is not too crazy. It sounds like it's basically a robbery compared to what the digital signal cost to send, but handling physically isn't cheap either...
If merchants accepted checks like in the old days, they wouldn't have to pay the fees.
@@Chicago48 Human handling of cheques and the associated issues isn't free.
The cost of convenience
@@FreeminderXIII Exactly. It's pretty much all about convenience and it's easier to spend money you're not physically holding in your hand. But there's digital theft just as easily as there was theft/skim/fraud with cash. Pick your poison.
If only there was some kind of digital payment system that could directly compete with centralized finance...
ua-cam.com/video/iKt9KepQQF4/v-deo.html
Rupay is good competitor for visa. Rupay doesn't deducts MDR.
With fintech growing so much, visa could be out of business in 10 years unless they innovate. That 5% current revenue share is all the key
Lol assuming visa doesn’t just get into fintech as well
@@Andres_Acosta but margins are moving towards zero and with fintech the no of intermediary role is also going to reduce.
Visa is always trying to innovate. They invest in fintech heavily (they tried to buy plaid for 5B), and even jumped on the crypto train.
@@nczioox1116 There’s no need for them in crypto other than to have their trading desk speculate on NFTs. One of crypto’s goals is literally to make companies like Visa irrelevant. In the meantime it’s just a race to the bottom for who can just charge lowest fees with greatest adoption.
@@martinlutherkingjr.5582 Wish I could agree with you, but the biggest irony of crypto (that few fail to acknowledge) is that the majority of people in crypto dont give a damn about replacing the dollar, but instead are trying to flip crypto coins to make more fiat dollars.
As an indian i find it extremely funny how one of the most advanced countries on earth is still bearing card network company monopoly, whereas in india we have unified payments interface and IMPS, under UPI we can scan a QR which the merchant has and we can payment without any charges, its so successful that even small vegetables vendors have it and for bigger transactions there is IMPS, visa and master card were crying before US govt due to revenue loss and we also have our own govt corporation developed card network Rupay🗿
The superiority of digital over physical transaction processing is a redundant topic. How they've managed to maintain a virtual monopoly in the space is worth covering in more detail.
Lies again? MasterCard Visa
Indeed, their high profit margin tells you that the market is not "free". Technological advancement should have driven down cost to a fraction of what they are today. There must be massively anti-competitive practices being employed here, and probably a very high amount of political lobbying.
0.25% per transaction is much? I was expecting a MUCH higher fee... Think of the convenience, for both the customer and the seller. Imagine all digital, no money. No need to give change, no risk of counterfeit money. No risk of being robbed. No need to pay someone to get the money from the store and ship it to a bank. All for just 0.25%? Sounds like a great deal to me.
EU limited fees that can be taken for processing card payments to a fraction of a percent so I think U.S. could do the same. It really helped small businesses to start accepting card payments. I think U.S. also could limit those fees, the question is if the want to do this. Since Visa is an American company it would drastically lowered taxes the government gets from Visa.
You should make video on 'India UPI' payment system.
Team American Express baby !
Customer service is top notch!
#TeamAmex Where the Members our the MISSION!
If you are a business...and want to circumvent VISA or encourage other forms of transactions...It is simply...Some places if you use CASH or DEBIT then they give a 5-10% discount on the goods or services...Other places have started implementing fees to use a VISA Credit Card to cover transaction costs up to 5%. This is how you encourage customers to use cash, debit, or other services.
Sure swiping the card might be more "convenient" however, small businesses won't ever have to spend 15% of their revenue storing cash unless they're really not doing well at all. Use cash at small business and use a debit card or credit card at the bigger businesses people.
Now I understand why here in my country Indonesia every payment gateway provider charges a freaking 2.5% fee from the total amount of transactions for every Visa, Mastercard, JCB, and Amex debit/credit card. Damn I'm making these guys Rich AF
In Malaysia, merchants are not allowed to charge this fee in customers.
I knew there were fees on the seller's side for card transactions. I always thought it was for the medium, like the card reader or app.I didn't think there was more😩
Thanks for explaining.
If the merchants just added 3% charges for card use like a lot of places already do people would use it less
Well, they can do that by adding it to the price of the product they sell without us knowing. Haha. It’ll be more beneficial for these merchants if their customer will pay in cash because that would translate as revenue on their part.
@@MarkLouieCantre except for the concept of free market competition, that these payment processors seem to somehow be immune.
love how they spent 3 seconds explaining how handling cash can be expensive too. dealing with theft and transport...what about counterfeit?!?!
Happy to see VISA and Mastercard became unpopular in India 🇮🇳, and happy to see India's own payment gateway RuPay, diminish the dominance of VISA and Mastercard!!
I my contry the ones that pay fees are the stores, and they cant charge you more if you pay with card.
Brazil?
LOL @ 6:17 Ya, just hit all those function keys, maybe it will unlock the infinite money cheat code 😂
I have a VISA card and I only use it with companies who refuse to accept Discover card. I moved from the VISA card to the Discover card when I asked both to decrease my card interest rates with Discover agreeing and Visa out right refusing to budge one millimeter.
Visa doesn't control your interest rates, they don't lend you any money. You are confusing your bank with your payment network - these are two different things.
Why are you paying interest at all? Bad money management I guess. Visa should be paying you to use their card, they have been my entire adult life.
It seems like they are talking about both credit cards and debit cards together.
@11:45 The charge in US is 10 % ? Wow that is really killing merchants, we only got 2% here, and even that most merchant pass that cost to the customer.
It’s about 3% usually in the US.
All we would have to do is change the receipt to show the swipe fee, and this issue would get fixed real quick.
Yeah if people actually realized that they paid for their ''rewards''
@@Bertuzz84People love convenience. So many people are still using cards at local businesses even if there's a surcharge because carrying and accounting for cash is more tedious than tapping a card.
👌👌 Nice info.
I work on mobile where charge fees are currently 30% and negotiations are going only as low as 10-15%. She quoted .2% (though I thought it was closer to 2%) and it still causes small business issues. Why do we let these middle men take so much profit?
There’s little incentive for consumers because they are unaware of the fee so they have no reason to figure out how to use crypto. Merchants don’t want to risk alienating customers by only accepting cash and crypto. For the small businesses that survive the next 10 years, I think you’ll start to see more of them accepting Bitcoin lightning, stable coins and Monero payments. Just need older generations to die off.
Because of the increasing of credit thefts and abuse...
8:45 could you pick a worse color scheme for a pi-chart?
UPI payments system from Govt. of India is literally way ahead of all these systems with ZERO FEES.
How do they make profit ?
@@glennpuystjens UPI is from NPCI(National Payments Corporation Of India)
NPCI offers other products like Rupay,NEFT,RTGS,IMPS
They make profit from these.
The Visa brand has become so synonymous that Ive never even considered how or why it came to be this way, just always was there but I became curious and this is fascinating.
With CBDC-s on the horizon the long term business case of Visa and others isn't looking so rosy. Right now it's a fantastic business of course, but it's still pretty much guaranteed that they will become redundant sooner or later, it's just a matter of when the public infrastructure will be ready to do the same job better and cheaper.
I have used both but the presenter is right we sign up for discover but use Visa or Mastercard or American Express
Card? No…Facilities transactions with their branded network on a card issued by financial institution, yes!
Also it isn’t too much of our decision to pick Visa or Mastercard when you sign of for a bank, they just tend to all use Visa.
And this bit of information was brought to you by American Express!
I'm just wondering here... what are small business owners going to do with the extra cash they'll save if for any reason we stop using our CC? Are they gonna pay employees better because if they are then I'll use cash, but most likely they'll just pocket that money.
The math, or perhaps the explanation of the math is poor. The initial lady said they made 25 cents on $100. That is 1/4 of a per cent
Which is low. Yet business are charged in the 2 - 5 % range which means that 90 - 95 % of those fees are going to other parties. Will.we see a break down of thhow it gets split by the parties?
Yeh, I was waiting for that to be explained.
And was disappointed when it wasn't.
They have a lot of costs to maintaining a global payment network, transactions are not free to process, they aren't even super efficient.
The largest portion of the fees charged by cards go to the issuing banks, it’s called interchange.
@@jnpconcept1 Yeh, CNBC really should have explained this - especially after showing that shop owner complain about how much he pays "to Visa".
@@jnpconcept1 Whoever is paying for my 2% cashback must be getting the majority of the fees.
does she have stock in visa?
I have two Visa cards. Can’t remember last time I used it.
Cards are becoming a thing of past in India. UPI is the new dragon.
Btw for bigger transactions we Indians mostly use imps/neft from bank app’s.
Cards may survive on credits cards
The video at 0:04 is from Brisbane, Australia.
12:30 oh my god... she's actually so deluded... It is not remotely skewed in favour of the merchants. She's a senior equities analyst and yet she doesn't understand basic accounting. Merchants don't get earn their revenue from the banks. Merchants earn their revenue from customers. Banks simply facilitate the transaction. For there to be such a significant cost just to process the transaction is absurd. Paypal does the same thing for much less. The one differentiating factor which she didn't mention which would make her argument so much stronger, is that Visa eliminates credit risk for the merchant. By using Visa, customers are able to pay on credit which is a convenience and the merchant doesn't need to take on the risk that the customer won't pay later on. That still doesn't justify the high costs however. Visa can absolutely afford to reduce their fees but there is no incentive to do so because of the lack of competition.
I think you should click this timestamp and watch it again.
This was eye opening.
Another Awesome VideO As Always * 💋
❤
Love your Channel 💙
Physical network, not internet type network. How do those 4 transfer money then?
That might be interesting to me, since my bank in the UK, NatWest, recently announced that they're switching the debit card provider from Visa to MasterCard, and this was revealed to customers via letter and e-mail.
The quality of this video by CNBC is not good. They should have done better research.
The card processing fees "swipe fees" have three parts:
Interchange fees
This goes to ISSUING BANK, such as chase, BOA, NOT Visa/Mastercard. on average it ranges between 1.15% - 3.3%
Assessment fees
Only this part goes to the payment network, such as Visa, Mastercard, etc, and it averages about 0.15%. This is number I found online, but this video mentioned a similar number at 1:17. "A quarter for every $100"
Payment processing fees
This is paid to the company ("card processor") that accepts the credit card payment and sends the transaction to the payment network, either through a physical card reader or an online payment gateway. These are the companies that provide e.g. POS machines and software that process the cards. Fee structures vary considerably depending on the credit card processor you choose
The total amount depends on types of card, business's MCC, and types of payment (physical or online). The percentage amount also depends on total sales of the business, as they are often charged some flat fees, and the more sales a business makes, the lower swipe fee in terms of percentage. AMEX usually charges the most, which is one of the reasons some businesses don't accept AMEX.
These fees are also not charged for nothing. They have to for example cover, equipment costs, and the risk of fraud. Online transactions carry a higher risk of fraud and/or chargebacks, and interchange fees are often higher on these transactions.
That's why in my country India the govt has introduced "RUPAY" which is freely and securely maintained by the reserve Bank of India.... So both customer and merchant don't get ripped off by a pvt entity like visa
The US Federal reserve is technically a private entity already. It's owned in equal parts by the banks operating in the US. If we duplicated that it would go from one privately held monopoly to another.
@@scwirpeo
I never knew that even central bank of usa is private.
@Rohan Chandra Nagaladinne thanks for the info
Great video, highly informative 👌
The video is very misleading. The fees that the merchants complain about go to the banks not Visa. Visa makes a few cents per transaction. If the banks were to be forced to make less money, it would minimally impact Visa. Crypto in its present form cannot compete with Visa as it takes minutes for a transaction to complete as opposed to sub second for Visa. Also, when I last did the math a few years ago the cost of processing a crypto transaction was thousands times more than a Visa transaction. Fine for a speculative medium, terrible for actually buying things. There is a lot more to it than that, but that gives a flavor of the situation.
I agree
Go try making a lightning payment and tell me how much it costs and how long it takes
I'd also say that Bitcoin and other unregulated cryptocurrency is fine if you are committing illicit activities...
There are many other alternatives, here in South Africa at least. There is Yoco
Time to take the financial companies out by democratising finance - DeFi
How the hell will that work
Like we Indians have UPI
We literally kick out visa
Visa debit cards totally wipe 😂🤣out
I didn't even use card since UPI come 🤣
Us tech gaints suggesting US goverment to develop same system 😁
Which is so so realible
Nd it was the reason now India
Haha world's highest digital transaction over 25 bilion $ a year
#2 China with near 15 bilion $
Nd thrid America 😁
UPI totally free 0 fees 😁
@@polarbear7
Expect it is paid by taxes is my guess.
Edit: Even worse the the fees start at 0.25% and grow upto 0.6% so it is not free. Wait, it is a bit more complicated.
@@polarbear7 you do know, VISA and UPI work on same platform, UPI charges commissions on companies that use their network, the differences are incremental and are better suited as a system to a developing nation where more than 200 million people don’t even have access to internet. Also the system allows for topping up with telecommunication providers and charges them a service so someone is still paying for the network, the charges are just different.
Would UPI like systems drain Visa treasuries?
Actually Visa gets 3% of every transaction from the retailer
card issuers and card machine companies take most of the fee, visa only takes a small cut about 0.25%
@@jeremyyang6060 not true
With billions of transaction per day the money Visa earns can add up. But banks and card machine companies actually take most of the fee because there are way too many of them, banks can't profit from a small margin.
American Express, on the other hand, takes every penny, so they don't need to focus on card volume, and they don't need to beat Visa in card acceptance. They charge a higher fee and focus on ATV.
Thanks for share
❤️