Your Mastercard URL got truncated somehow. It's a pretty easy search, though. Just the same, thanks for linking because I had no idea this was even an option:
> To opt-out from our anonymization of your personal information to perform data analyses, please provide your Mastercard or Maestro payment card number below.
This sounds like they are going to continue using my purchase data but without anonymization? Not a native speaker so perhaps I'm just misunderstanding the sentence.
I think they tried to formulate it so it will sound less damning for them, like they want to make it explicit that what they performed their data analysis on is your anonymized personal information.
They don't charge 3%, they charge about a tenth of a percent (0.11%). What you think of as fees is actually a basket of charges going to different parties. almost 2% goes to your (the purchaser) credit card company to cover the risk of you not paying them, about a percent goes to the store's bank to cover the case when they have to give the money back (either because it was a fraudulent online transaction, or the store cheated the customer and the customer went to their card issuer, etc.) and that tiny little bit that's left goes to Visa/MasterCard.
Credit transaction fees actually make lots of sense and are grounded in the actual cost of the financial product. As a merchant, you can choose to accept only debit cards to avoid the cost
I get that this is how it works in the real world, but the argument that transaction fees are necessary for the credit company to cover the risk of the cardholder not paying is a bit feeble, because to my non-banker mind: that's what the interest rates are for. If someone is risky, simply don't approve their application, or raise their rate. Am I missing something?
The 2% that goes back to the credit card company is what ends up paying for all the rewards points and cash back discounts—which work as mechanisms for you to get that money back so long as you actually pay your credit card bills.
> about a percent goes to the store's bank to cover the case when they have to give the money back (either because it was a fraudulent online transaction, or the store cheated the customer and the customer went to their card issuer, etc.)
Is this right? It's been my experience (in Canada) that losing a fraud case or chargeback the store takes the hit.
A "savvy" customer has a card that doesn't make them perform a dog and pony show like you describe. A savvy customer's card charges the lowest reasonable rate in order to provide the service.
Giving someone money and then feeling all giddy when you get a "reward" later means you've been gamed.
But this is such a weird way to think about it. Credit cards don't cost anything. In some vague grandiose sense prices are slightly higher since credit cards exists and merchants want to cover their fees but my perspective as a customer spending via a credit card is basically free money. There's no dog and pony show except buying things like I normally would.
* I get literal cash through their rewards program which just slowly accumulates without me having to think about it.
* I get all the nice protections and can do chargebacks.
* The money I spend every month stays in my bank account until just after the bank calculates and cuts my interest check. Like it's super negligible but hey, if I'm getting an interest free loan anyway.
2% cash back from the card + 0.25% interest from the bank ain't nothing.
The point is that everything you buy with the card is at least 2% more expensive, because the merchants are just passing on their credit card fees to the consumer. You are not saving money in any way, shape or form.
Once upon a time, it was beneficial for a merchant to accept credit cards, it lowered their costs for handling cash, which meant they saved money and the 2% cost for each transaction was reasonable.
In a world where everyone is using credit cards for every purchase, that 2% is essentially a tax instead.
Yes, you absolutely should use a credit card in the US and get your cashback or rewards or whatever. You have to play the game, because everyone is playing the game.
But, you have to realize that it's not beneficial to you. You don't earn anything, you merely, barely, move the needle back up to break-even. You're not gaining. You're not winning. You're not sticking anything to any man. If the entire credit card industry got rid of rewards, and lowered their merchant fees, it would be a net benefit to you.
So feeling happy or grateful for cash-back means that they got you, they tricked you into feeling grateful for the privilege of giving away your money.
If you paid cash, in virtually every case you'd pay exactly the same price because most merchants don't provide cash discounts. If your merchant does provide a cash discount, I would suggest taking advantage of it. But if they don't provide a cash discount, you're still paying that 2% margin anyway without receiving any benefit from it.
Likewise, except for small businesses whose owners don't actually price in the cost of their own time and labor, it's not entirely obvious to me that the cost of accepting credit card payments actually is any more expensive than the cost of handling cash, which is probably why cash discounts are rare. The main exception to that seems to be gas stations (which usually have a lower price for debit cards and not straight cash), except even in that case, I get an even bigger discount by using Costco's gas station, which doesn't have any such discount. You do address this point...
> > Once upon a time, it was beneficial for a merchant to accept credit cards, it lowered their costs for handling cash, which meant they saved money and the 2% cost for each transaction was reasonable. In a world where everyone is using credit cards for every purchase, that 2% is essentially a tax instead.
That makes no sense. If the cost of receiving credit card transactions is 2%, that doesn't imply that the cost of receiving any other kind of transaction is 0%. If there's no cash discount, the difference in cost to the consumer is zero anyway. But the difference in cost to the merchant isn't 2% either, because if they accepted a different form of payment, the difference in cost would be 2% minus the cost of accepting that different form of payment. (And if they didn't accept any form of payment at all, the cost would effectively be 100% because there would be no sales). In a world where credit card sales are ubiquitous, if anything, credit cards become a better deal for merchants because there's less economy of scale for cash-handling services.
All in all, I would even suspect there are instances where credit card rewards end up providing a net positive to a sufficiently devoted cardholder simply because most people are not going to expend the time and effort necessary to maximize their credit card rewards. It's just like Vegas in that sense--while it's true that "the house always wins", casinos will also comp you rooms and drinks, and there are documented instances in which you would expect to be better off playing video poker or blackjack for long enough to get a free room (assuming perfect play, which means memorizing a small decision tree). Why is this possible? Because the vast majority of people don't play perfect blackjack or video poker. Businesses plan for average-case expected customer behavior and not best-case (or worst-case from their perspective).
The cost for a merchant to handle credit cards is whatever the credit card companies can get away with.
The actual cost of handling card payments is very, very low these days, but merchants are stuck paying the higher price, because there's effectively no competition in the space. To avoid having obscene profits, the cc companies give back a lot of the extra money to the consumers in the form of cashbacks and rewards, and then consumers stupidly feel grateful for being fleeced.
In an ideal world, merchants would pay only the actual cost for handling card payments, only pay for the tech itself, and the fraud risk. Naturally, such a pricing would be a fixed per-transaction-fee, because the actual cost is the same for each transaction.
In the same ideal world, the credit risk of credit cards have to be managed through the interest rate and credit worthiness management. It's completely outrageous that credit card processing fees should in any way, shape or form cover the risk side or the fraud side of the business. That's not the merchant's problem.
> The actual cost of handling card payments is very, very low these days, but merchants are stuck paying the higher price, because there's effectively no competition in the space.
In other words, the cost of processing credit cards is low enough that it successfully competes with every alternative form of payment. In which case I don't see what you're outraged about. Invent a more cost-effective payment mechanism if you think there's an opportunity for it.
It's also worth mentioning that cash isn't necessarily any less expensive for merchants to accept. It is if you're talking about a small local business or something, but if you're paying for the actual labor of counting cash, delivering and depositing it to the bank, as well as the increased security risks and costs of holding large sums of cash, it starts to add up.
I pay $89/year for my card, which I use for every purchase. I get hundreds if not thousands of dollars in rewards each year, and have never paid a penny in interest.
There's no dog and pony show involved, and I have not been gamed.
The merchant pays the interchange rate regardless if you get a reward or not. If you have a no annual fee card with no rewards, you are simply leaving money on the table (which your card issuer pockets), since you can get 1-1.5% cash back, also with no annual fee.
A "savvy" customer pays their entire credit card bill every month, so the actual interest paid is zero. At that point, the rewards are the only meaningful difference in return from one card to another.
The rate a card charges differs from applicant to applicant. Without knowing your credit score, credit history, and other financial information I cannot recommend a card for you.
The rate a card charges is immaterial since if you pay the entire balance each month, you pay zero interest. (And if you don't, you're making a big mistake.)
You're not flying to Hawaii for free. Every single purchase you made with the card was more expensive than it had to be, because the merchants needed to cover their credit card fees.
What you're doing is the equivalent of always paying with bills, and dropping your spare change in a jar. And when the jar is full, you buy a ticket to Hawaii with the money in it. Except with a credit card, they keep the jar, take half the quarters, give you back the rest, and make you feel grateful for the entire experience.
In this particular case all of the people without premium cards who pay with cash or debit cards with no rewards are paying for our free lunch and flight to Hawaii. It's a tax on basically every transaction, paid to those participating in the rewards scheme
With VISA and MasterCard yes, but e.g. the German girocard network on its own doesn’t sell anything, and there it depends on your bank (and most banks don’t sell that data either).
So if you have the choice between using a girocard or a credit/debit card to buy a product, the credit/debit card is significantly more likely to sell all your data.
I'm not sure that the "Device Account Number" matters. As I recall from the presentation, that number changes with each purchase. And Goldman has promised (ha!) not to sell your information for marketing purposes.
But it's still worth opting-out of your Apple Card's virtual number.
The number is in the wallet app, ... > Card Information
Unless you are carrying your cell phone at the time—not sure anyone is doing this yet, but I have heard of at least one chain that tracks customers' cell phone locations via triangulation.
It used to be common to track the mac address of customers that pinged the in-store wifi. Not sure how much this happens now that some phones randomize mac addresses.
How accurate does it need to be? If you shop in a market stall, or a bodega, then you could be tied to a neighboring store. But if you're in a regular-sized (American) store, it's certainly good enough.
