Banks serving as guinea pigs for Federal Reserve’s instant payments system
arstechnica.com
The Fed's goal is to connect 9,000 financial institutions nationwide.

Fed’s new instant payment system could be trouble for PayPal, Venmo::The Fed’s goal is to connect 9,000 financial institutions nationwide.

  • darkfyre@lemmy.worldEnglish
    17·
    1 year ago

    I think between rewards and actual credit, credit cards will probably be fine, but I’m curious if you think this solves for either of these use cases.

      • Deuces@lemmy.worldEnglish
        2·
        1 year ago

        I can see it going either way. I think it’s gonna come down to apple and Google getting on board. If they adopt tap to pay with this system vendors will have less incentive to accept credit card fees. If they don’t, it won’t become ubiquitous enough for any store to get away with not allowing it and consumers will look out for their own interest to keep taking the credit benefits. (I realize collective action would make that argument void, I doubt true collective action is possible in any senecio.)

        That said, I cannot see a world where the banks let it get that far. This system relies on the banks cooperation and it wouldn’t be the first time they bought a law.

    • malloc@programming.devEnglish
      3·
      1 year ago

      Credit card rewards are really not worth it. These programs are largely funded by the fees that are charged to merchants which are ultimately passed on to you at time of purchase.

      I would much rather have reduced costs of goods rather than have paltry credit card reward programs.

      • darkfyre@lemmy.worldEnglish
        2·
        1 year ago

        Ok, but if this new payment model takes over and there are no fees to merchants, I’m very skeptical those savings will be passed on to buyers. I think at this point credit card processing is pretty well priced in.

        • malloc@programming.devEnglish
          1·
          1 year ago

          Probably right for most big box stores or multibillion dollar businesses. But you would be surprised how thin the margins are for local grocery stores. That 3-5% in processing could be used to compete or undercut big box competitors that price in the credit/debit card fee.

          I think with the right approach (small businesses first) it could see high adoption. Plus it would make it slightly more attractive in setting up shop in places that wouldn’t otherwise get any attention (ie, food deserts)