Bitcoin Forum

One of the main reasons I though bitcoin will grow is that actually you pay to send money, you pay to pay via credit card or bancomat. But what if those payments get totally free? that would be a simple way banks would use to defend against bitcoin. They have a lot of other ways to make money, lending money, investing and such.

I doubt the banks could afford to do that. They make a fortune from credit card fees, but lose a lot from credit card fraud. The fees help offset the cost of the fraud.

The consumer does not actually pay money directly to transfer money from the consumer to the merchant via credit cards, it is the merchant that pays (the consumer pays via higher overall prices at the merchant).

It would be unrealistic for credit card processors to not charge merchants anything because they are providing a service to the merchant and are taking (and managing) certain risks to process these payments. It is very similar to paying TX fees to miners except that there are more intermediaries that need to get paid.  

actually since 2013 in UE fees are 0,2 for debit card and 0 3 for credit card, this is the new order. Very low if you consider that before could reach 2%. That does not go in the direction of bitcoin...

Consumers only use credit card for small transaction.

For business and large transaction, wire and tt fee are very low. Even lower than bitcoin if you factor in bitcion/fiat conversation rate.

What happens is that there will be no credit card companies.

They are far from being free to keep running, plus the frauds and consumers that won't pay the credit bill etc...

why should people use bitcoin?

It is impossible. It means the banks get nothing from offering credit card. And the credit card companies are out of business. The better solution is to lower the transaction fee to compete with BTC before  realizing they are losing customers to BTC.

If fiat transfers became free, the public would be far more skeptical of Bitcoin. "Why should I switch when Im happy with what I have?"

CC fees cannot go to zero because they need those fees to cover fraud, cover people not paying their bills and cover the cost of running their network and adding improvements to their network infrastructure. Fiat transfers are way more expensive than Bitcoin, even with wire transfers I'm charged $15 for accepting one, bitcoin fee is just $0.06 even if 800 billion dollars are sent (hopefully not a lot of outputs).

More importantly though is that fiat is printed (paper and electronically) everyday, making the dollar less valuable everyday. When I think that 3600 coins are currently made a day I cringed, then when I think about 2.7 BILLION dollars coming into existence every day I immediately see why fiat will fail.

Fiat won't necessarly fail. It has survived for thousands year and could do. Inflation is not so high to make problems. In reality it pushes people to invest their money rather than holding and this is safe for economy, which lies in moving money and buying things. Then if you consider the interests you get from keeping your fiat money invested in some secure ways (there are many oltions) you will see that interests cover inflation and overcome it. My parents for example have a lot of money invested since many years ago and have not lost for inflation.

The US banking system seems much less advanced than the European one, at least on the retail level.
I've paid 4 figure amounts by bank transfer in the UK, with no charge, and with the payment arriving within two hours. (In practice, much faster than that.)

probably better to start a new thread instead of changing the topic

are you talking about an international bank wire transfer, their is no way the banking system can compete with cryptocurrency's

 A lot of merchants have begun carrying some of those costs over to the consumer.   For example, many liquor or convenience stores charge a small fee to use a debit/credit card.  Additionally many gas stations have a completely different price for gas if you are paying with a credit/debit card instead of cash. 

That is a really interesting idea though, if credit card companies reduced their transaction fees to compete with BTC.  Ultimately, that would be better for the general public.

The credit card companies are providing more service for their fee though.
Buying by credit card provides consumer protection via chargebacks, protection if the merchant vanishes or goes bust, and others, like additional insurance.
(Plus of course the credit card company is providing you with credit, and provided you pay your bill in time, interest-free credit at that.)
A better comparison to Bitcoin transaction fees would be when paying by debit card, when you don't get those additional services.

There are too many middlemen involved for credit card payments to be able to be able to compete with bitcoin on a cost level. When a company signs up for credit card processing they are likely contracting with an affiliate who is working on behalf of a merchant services company who will send the transaction to Visa, who will get the money from the issuing bank. All of these people/companies need to get paid if they are to continue to offer their services.

For me, the banks would also need to make international wire transfers free. They should also not ask me what the transferred money will be used for, and don't make any attempts to block it.

This would never happen because banks are required to follow AML laws that make it necessary to ask these kinds of questions. If they openly neglect to ask this information they will be put out of business.

If there were no fees to send money you can assume the customer would be charged the same amount in one form or fashion.  Companies and governments are run like business and they know how to charge people in many different ways to make a profit. 

I couldn't care less about fees. I hate credit cards because they know my life better than I can remember it!
They track every single purchase, AND where you are on the globe.

Just the other day my credit card was frozen again, because I was traveling.

NOT GONNA HAPPEN  8)

If that is the case, then the banks could do something to minimize the credit card fraud to near-zero levels (by implementing new technology and improving the overall security) and then lower the customer fees. But still I don't think that they could afford to make all the credit card transactions completely free. But they really need to lower the exorbitant fees which they are charging right now.

what I am beginning to think is that bank system even if not totally free can be acceptable from large part of population. And could be in the future. Paying 15 dollars to transfer once a lot of money from Ue to USA is acceptable by most people. In UE you can send Sepa transfers paying nothing. What I think and notice is that bank system is slowly evolving, using Internet and technology, and is getting more and more fast and cheap. If that will really happen, btc will lose a lot of its force of seduction. I think that most people in this forum underevaluate today's bank system and give as accepted that bitcoin is much better. It is not.
Inflation of fiat money is small too and acceptable by most people. Basically every  economist consider inflation as positive and deflation as a problem.
So Going back to topic if you consider that fiat transfers will become almost free, easy to make (see iphone 6 nfc and fibgerprints) and immediate... I see a dark future for bitcoin. I don't want to be a dick, I am myself a bitcoin investor, but I like to watch  at things for what they are rather than what they should be.

are you sure that fees are so high now? tell me sources please. Here in Ue its 0,3% maximum.

Anyway if iphone 6 nfc becomes the standard fees will be much lower since there is no possibility of fraud, basically. If you have seen iphone 6 presentation it tells how much nfc has been improved. There is no more need to give anyone your password and your card number. So it is fast secure and cheap.

Only reason people would still use bitcoin is when they want to make anonymous transaction. But there is cash for that.. (maybe in the future it will be abolished??)

What if god came down from the heavens and created a new alt coin?

Or Allah..

Maybe we'll have an alt coin war of the alt coins created by gods?  Zeus's coin?

No matte what BTC still has tons of advantages over credit cards.

Why is everyone obsessed with comparing BTC to credit cards?
They are completely different things. With BTC you are paying with money you actually have. With credit cards you are borrowing money to buy something.
There are two different issues there, credit vs debit and fiat vs crypto.
The correct comparison for BTC would be debit cards.

Well for most people buying things with a credit card that has a decent rewards program is always going to be better than buying with Bitcoin. Not much you can do about that. Bitcoin will just have to compete in other spaces.

essentially it is free with a debit card.

Huge companies have to be maintained and make profit, this costs money, also the have to insure the money. So no I don't think fiat transfers via credit card become free anytime soon.

Banks and credit card companies do not ever, ever do anything for free.

All those buildings, vaults and security, IT specialists , customer services agents, phone bills, hardware, electricity, insurance, to the plastic bits of card, TV adverts, and of course the cost of staff wages and then there is also the fraud and losses (and the private jets, and bribes, and "donations" and lobbying costs, legal fees and bonuses oh yeah do not forget the bonuses) they do not all pay for themselves y'know.

What they may give with one hand, they will take with the other.

Also, by hook or by crook, a lot of the legacy banking industry is old and obsolete, and along with many other industries is about to be
disrupted by technology in a major way, many things currently undertaken by humans will in the near to mid term future be undertaken by protocols/robots, and the banking industry is no different, in fact it is prime, and it looks to me that Bitcoin and blockchain technology is going to play a part.

(Que the internet of things,automation,drones,AI,big data,hyper-hyperconnectivity,DAC's, DAT's)

I personally would be very surprised if banks stopped fee's on things such as credit cards as that would mean they would be losing out initially and would not be good for them, it would be really silly of them to do it as well just to become better than bitcoin if they ever did choose to do it.

They can of course make their systems much better. But - due to regulation - they can not differentiate with different levels of insurance. Can they eliminate theft with better security, thus reducing cost of insurance? I doubt it, with card information for billions of people centralized at different merchants.

They have no reason to stop charging merchants for accepting credit cards. They incur costs for processing these transactions and they are not a charity.

That's never going to happen...that would collapse the current infrastructure.

and yet Noone has provided the real fees existing for most common debt or credit card. Talking about debt card, which is bancomat here where I Live, fees are very very low. You pay with your bank account and transfers is immediate. Clearly with a credit card where you borrow money from your bank things are different because someone could not pay back. Anyway I would like to know exactly fees in US or where you live.
I think that facing reality sometimes is better than still living the utopian dream... yes I could like to see btc become popular, even simply in Internet... but is this likely to happen? In 2013 there has been a clear bubble, we have gone back to 2012 levels... things could even get worse.
Consider even simply a fact. Banks can improve and change their technology in every second, being willing to do. Btc is a technology of 2011 and it will more or less stay the same. Since we go for the long term adoption, with all innovations happening every year, how is possible that in 2025 we should be using a technology of 2011? it would be same thing if right now I was using the first iPhone instead than my galaxy s5.

2012 levels? are you sure?  ???

Also, the fees are paid by the merchants normally not the customer, but then the merchants quite often then pass the fees back to the customer via marking up the price of all of the goods/services that they sell (not just to cover the cost of the fees, but also fraud and chargebacks)


Also, banks apart from a few innovations here and there are using decades old technology, American Express first issued charge cards (not diners cards) in 1959 so 55 years ago... and actually people still use cheques can you believe.

Not to mention that BTC/Cryptocurrency technology (and what is built ontop of it)  has changed since 5 years ago, and it will be just as different again in another 5 years, and in 2025.