people would be crazy to use bitcoin for day to day purchases given that it offers zero consumer protections.
people would be crazy to use CASH for day to day purchases given that it offers zero consumer protections.Customer protection is helping chargeback fraudsters not honest customers. This kind of customer protection is paid for by honest customers, because shops need to add the 3-6% of chargeback fraud and costs associated with it on the price.
This kind of customer protection also disadvantages small shops - Amazon can deal with chargebacks in an automated fashion. As always, when big corporations or govt is "doing something for your protection", it is just to enable them to control you and rip you off.
So true, also the thing about charge backs is that even if someone stole an identity and the merchant does everything correct/follows all the rules according the CC processing company to verify a transaction to credit card and there is a charge back the returned funds get taken from the business who did the transaction.
When my company was processing with merchant accounts there was a thick manual that had all sorts of procedures to follow before accepting a CC although that takes so long that just about NO ONE does it. Even when you call to do a "manual auth/verification" they charge you extra money! IMHO those higher CC processing fees should cover those manual auth calls since that is suppose to help stop fraud. Of course most of the time identity thefts are already ready to handle that and would have all the correct information and sometimes people don't realize that their credit card has been stolen until a nice large bill has been racked up.
Also,
more fees when the transaction is not done with "card present" like if the customer's card doesn't read in your machine for some reason and you just enter their CC number. They consider this "high risk" since many phone orders/internet orders are done this way but even if you can prove that your customer is standing in front of you they don't differentiate.
Even if you integrate CC processing into your website and turn on ALL of the verification settings so that the buyer has to have exact matches on all their information and more (which is a PIA for the customers when they type "PO box" or "P.O. Box" it may reject unless it is exactly the same as the billing address) etc... they still charge a higher rate than face to face transactions because again, it's a "high risk" category. When it is such a PIA just for a customer to pay then they usually move on and may just go and get something similar from Amazon so you just lost a sale.
Giant merchants like Amazon can be more lax on some of the CC verification since they make so much that a few hits from a stolen card is nothing to them and they have already factored that into the budget as cost of operations. Same thing like brick and mortar stores factoring shoplifting and I'm sure stolen CCs too.
The people that these CC companies and banks affect the most are small to medium businesses as most of the time since they can't all afford to have to take the hit for multiple charge backs due to fraud, even though the merchant had done everything correctly. Sometimes it can just be a couple purchases that can wipe out a company, as sometimes these thieves get a hold of corporate cards that have high limits and don't get flagged because large purchases are already common. Then the company that it was stolen from does not notice that the charges until months later and it is already too late as you have already shipped your product to their drop address. Those cards will even pass through a phone verification and manual auth, so lets say they buy some miners, that could easily come up to 100k or more just using 2-3 CCs and different names.
So everyone is talking about "consumer protection" well what about
merchant protection?! Merchant are the consumers for the CC processing companies too right? That extra 1-2% for online merchant accounts, gateway fees, monthly fees, minimum sales, etc just go straight into their pocket because in the end the merchant pays for ALL charge backs, fraud or not, even if you show them that all the correct procedures which they require you to do were done. Where is our (the merchants who are consumers to the CC companies) consumer protections? Why are extra fees paid when all the liability is still on the merchant? Especially when the CC reps say that the higher rates are to cover loses but it's not their loss... even the merchant gets charged a flat FEE when a charge back is done, fraud or dispute and even if they find the dispute in your favor they still charge you that fee.
How is that fair? These policies would wipe out a small business like Bees Brothers (the kids that sell honey for BTC) if someone used a fraudulent CC and made a huge 100k order. The only choice you have is to try and dispute with your merchant account provider but that doesn't really make a difference, they will even try to automatically take money from your bank account without permission to cover the charge back.
At the same time the cost to set up a merchant account is not cheap (well cheaper now than it use to be) but still is a barrier for smaller start up businesses.
With BTC none of that happens and if the transaction is so large that there is a concern then escrow could easily be used and for a lot less than dealing with fees from a charge back. There is still consumer protection, people just need to be taught how to use BTC properly. Along with that there is also Merchant protection so it's a two way street.
People have gotten so use to the debt based consumerism and all the BS the CC companies push like "100% fraud protection" that everyone files a charge back for anything and more often than not abuse the system. The CC companies don't care because they are not actually losing the money since they just take it from the merchant and if they don't pay then the bank will just close their CC processing account.
How does this help our society as a whole? It only leads to people being more dishonest since it is piratically encouraged by all the big money processors.
