Sounds like the real villains are the credit card companies who have the market power to enforce fees on cancelled payments. They are so entrenched no one is even questioning their position anymore.<p>Visa and Mastercard are massive drains on our economy - it's ridiculous how unquestioningly their 3% tax on commerce is accepted.
This will affect businesses that do 3rd party merchant services, like events. If the event is cancelled, refunds are issued. Who pays that fee? It would be up to the business to try to claw back funds from the promoter of the event... who is now bankrupt from not being able to do their event. It gets ugly fast.
I guess the days when refunds were frictionless so that consumers could purchase with confidence are gone? Refunds have always been a cost of doing business - it just seems the processors / card companies want to change the rules and have their cake and eat it now that cash is mostly dead.
Does anyone know if the "real big" merchants like Walmart have to pay the fee? I assume they're so large they can sit on the processors and squeeze them (I know Costco does, they pay 0% fees in-store because Visa is so hungry to be their processor).
I learned the hard way in March 2020 that PayPal doesn't do this anymore either. I was helping an organization raise money for a Charitable 5k when COVID shut everything down.<p>This was when everyone thought the world was ending still so we didn't think to change it to a virtual 5K. Refunded all payments on a couple thousand dollars and was out around 4% in processing fees.
I guess this will get back to the consumer, either by having to shell out these fees, or by merchants refusing to refund altogether.<p>The one thing I am wondering is whether PayPal and stripe will follow
Why cant US have something like UPI [1], which significantly reduced reliance of credit card companies and extra payment traaction fees in India. Is there some regulation holding this back or no state or federal government has tried it yet.<p>[1] <a href="https://en.wikipedia.org/wiki/Unified_Payments_Interface" rel="nofollow">https://en.wikipedia.org/wiki/Unified_Payments_Interface</a>
Well, they launched as a PayPal alternative, but now they are copying all the negative features. Anyway, we've stopped using Square long ago given their obscene policies. One such policy is charging $70 per month for "team access"! That's absolutely crazy to put a basic feature under a greedy paywall! So, basically, they force people to share logins! Add the rate hikes, now this! Sorry, but there are alternatives such as SumUp, Stripe Terminal, Clover, QuickBooks, etc. In fact, if you want the lowest swipe rates, go with QuickBooks!
Uh, if only there existed a neutral, owned-by-no-one, decentralized monetary network with instant low-cost transfers and finality.<p>Too bad this sort of stuff is out of science fiction.<p>EDIT: aaaand I'm being downvoted :) At least leave a comment.
Devils advocate: this penalises businesses with a LOT of refunds. Which is probably a good thing. Because they generate a lot of work for square and are doing something wrong commercially (misadvertising?). And SHOULD be discouraged...