alt Hacker NewsThe biggest thing is disputes. I have no problem with an escrow service asking for a cut if I want to use them, cause they have real costs. The creepy thing is how that escrow built into credit cards is forced on every little transaction.
Replies
As I understand it, most of the fees associated with US credit cards don’t actually go to the parties that are on the hook for disputes.
I actually think this is an example of where government should be more involved - like often times if I file a chargeback, there's a solid likelihood that there should a real world repercussion to the other party because it's probably related to fraudulent or abusive behavior.
PayPal does this well with friends & family transfers.
Not just disputes. Also absorbing some significant part of the cost of fraud.
I have had to fight hard for disputes, even with “premium” credit cards like Amex Platinum. I’m not talking about “not as described” bs, but being asked over and over for the same info to wear me down.
I recently ordered some snacks from another country and after 3 months the vendor stopped responding while never having sent anything. When I asked for a chargeback, my claim was denied because I didn’t have proof they didn’t send anything! I literally had an email from them that said they are backed up and unable to send stuff.
> The creepy thing is how that escrow built into credit cards is forced on every little transaction.
That's essentially what a CC company does though, every transaction they're briding the timing gap between the card holder paying the CC company and the CC company paying the business. That's the core value add and cost they're bearing that they charge for.
They have risks from both sides of the transaction; on the one hand scam merchants who might get chargebacks and on the other customers who never pay off their balances (thought I guess that risk is covered by their interest charges mostly).