Credit cards are pretty meh for people that accept them. A % of your money disappears. The customer can say, for 60 days, "nah I didn't want that" and the money is taken away from you, no questions asked.
There was this big push in retail a few years ago to get customers to stop using credit cards. I knew it was going to fail, but merchants are looking for alternatives here.
Stores easily make up for the CC fees on volume because it is so much easier for consumers to impulse buy. In fact stores are now happily offering "buy now, pay later" deals that cost them much more in fees than CCs because it boosts volume even more than CCs. CC companies are scrambling to catch up there.
Merchants grumble because that's what merchants do, but they are coming out way ahead anyway. There was (maybe still is) a cash only restaurant/bar in Boulder back when I lived there. The food and beer were great. They probably could have done an order of magnitude more business if they charged $0.18 more per burger and took CCs. Instead they had an ATM that probably charged the customer 10%. They weren't sticking it to the man, but they sure were sticking it to their customers.
This is not a fundamental property of credit cards. It is a method of dispute resolution.
Retailers dislike dispute resolution processes that favor the consumer by default. Their alternative, for the most part, is a process wherein they simply control the whole process and can decide in favor of themselves on a whim.
> Credit cards are pretty meh for people that accept them. A % of your money disappears.
> There was this big push in retail a few years ago to get customers to stop using credit cards.
Really, says what retailers? EDIT: saw your note below about MCX. Noted.
- Your revenues go up because people are spending money they may or may not have in the future
- You don't lose out on a sale because someone is a 5c, 12c, 18c, etc. short
- You don't have to deal with physical cash (armored transportation to banks, miscounting, theft, etc.)
I personally think CC fees are egregious, but pretending they add little to no value to the extent that they aren't useful for the merchant is pretty myopic.
That seems contrary to the trend I have seen here, which is more and more stores going 'cashless', and only accepting credit cards. The cost to handle cash is more expensive than the percentage that the credit cards take.
I think the fact that it never got off the ground shows that the ask is pretty impossible... it is really hard and expensive to securely run a payment system like that.
If you aren't charging merchants fees, how do you sustain it?
1) Credit cards with transaction fees (which crypto people hate) that protect against this and have replaced the needs for checks
2) You take checks from people you trust
3) You have banks that compete with each other for storing your dollars and provide services to protect against fraud.