[TACIXAT]

I applied to YC to bring this idea to the US (rejected). Credit cards are our primary form of digital money and their fees are excessive.

The basic design was ACH money into the wallet, transfer money between balances for ultra low cost (1%), ACH money out of the wallet.

The difficulties are regulation. Doing this would make you a money service business and banks really don't want to touch that. Plus it costs a nice chunk of change to register in every state.

If card processing companies are taking around 3% + 30 cents of each transaction, they've effectively devalued our money by that much. I think you could skip all the NFC terminal nonsense and just do QR code based payments with the camera. Make low fee transactions a reality. Then you could pay for individual news articles online, support forums monthly (no way to pay a fraction of a cent for a page view), or tip your favorite streamer. It would be beautiful. It could also set us free from the ad based tracking economy.

Maybe one of the big players will implement it (Google, Apple, Walmart), or at least figure out the business model for someone to copy. I think it could really change the US economy.

[jboles]

> Credit cards are our primary form of digital money and their fees are excessive. The basic design was ACH money into the wallet, transfer money between balances for ultra low cost (1%), ACH money out of the wallet.

2% (credit card fee) is "excessive", but 1% is "ultra (!) low cost"?

[TACIXAT]

The fixed transaction cost is really what eats up low value transactions. 30 cent fee means anything below 30 cents is unusable. A 2 percent fee with no fixed cost would be fine with me. If you know of a processor that does this, let me know.

[jboles]

That’s a fair point, I had not considered the micro transaction aspect.

[ac29]

So its more expensive than debit cards (0.05% + 21c) to the merchants, and has no reward incentive for the consumer (1-1.5% back in cash or points is typical). Who was it supposed to appeal to?

[pishpash]

The claim is that the fees primarily cover fraud and fund various consumer protections. It would be interesting to know how much of the 3% that actually is.

[TACIXAT]

I bet a lot of those go to rewards. Also, cards are pretty insecure. Maybe a phone with a lock on it to prevent physical theft and use, and all the data you would have associated with each transaction would make a great fraud detection system.

[driverdan]

> I bet a lot of those go to rewards.

This is the kind of thing you should know off the top of your head if you're interested in competing with them.

[TACIXAT]

Yea, that's one piece of information I haven't found. I'll have to look if it's in SEC filings for credit card companies.