[hahn-kev]

They way it works I don't receive a charge like you do with visa, the merchant presents a code, you scan it when your bank app and then the bank app asks if you want to send # of money to [merchant name], if you don't want to pay it then you don't approve the transfer in your app on your phone.

However after the fact there's less options, I've never gone through

[cornholio]

Bundling consumer protection with the payment system was always a bad idea. Payments need to be instantaneous and free.

The returns/refunds can be handled offline by a mutually agreed facilitator that does not have a monopoly on the payment system. You can also have a legal mandate that all internet purchase, for example, should employ such a service, that charges a market fee and is then liable for making fair decisions.

[mirzap]

It is not a bad idea. This is how it is supposed to be. My bank offers this even with Mastercard. I have to approve transactions when paying online. It's instant, I finish checkout, and then I receive the push notification asking me to confirm the transaction. I don't know if I would ever use CC in a country where banks don't allow this.

[xyzzy123]

That is authorising the transaction and it makes sense for the card issuer to handle that. It's proving that it's "you" using the card and you really intended to pay for that thing. Maybe they SMS 2FA you, maybe they have a biometric check, etc. All cool.

The case where you have a dispute with the merchant (i.e transaction is authorised but problem is 1 layer up - you feel that reality doesn't match up with the payment record!) is different. You paid as intended but the thing you wanted didn't happen. Right now things are bundled together.

Sometimes this is handled by marketplace (think amazon, vs paypal/ebay and their different balances of favouring merchant vs consumer) but overall (e.g. consider shopify who are basically uncontactable in case of merchant disputes) I don't think the whole payments system makes this very clear. In practice it is sort of a shifting balance between various parties.

There are actually big questions of who eats risk between consumer, platform, merchant and various payment processors for a given transaction and things are a bit obscured. In practice all the parties EXCEPT the consumer know what is really going on.

It could be made much more clear who has the responsibility for resolving merchant disputes and their records could be made public, and this could be a more explicit point of difference in payment / marketplace offerings.

I think lots of people would make different decisions about where and how they bought things if they could see statistics about how disputes are handled.

I am not arguing for any specific method of solving disputes or more government intervention in general, I just think that if things were more transparent (mandatory reporting) fewer people would feel ripped off, people could make more informed decisions, and marketplaces / processors who are adept at resolving disputes would be rewarded as they deserve. Basically, the market would work better.

[xyzzy123]

P.S. There are a LOT of details in this specific idea, some consumers are bad actors and are never happy, some merchants likewise are bad actors. Resolving these issues without disclosing sensitive information is extremely difficult. But largely processors are sort of punting on it in various ways when common sense resolutions seem possible. Like if a consumer has 50k transactions with 0 chargebacks and they initiate a chargeback, it's probably a merchant problem. This argues for collapsing the layers but channel-specific resolutions have the advantage of being able to look for delivery signals and other specific mechanisms of performance. Figuring who is right in the world is a hard problem in general. Possibly the Stripe Elite will correct me here since this is the Hard Problem of payments. Which can be solved well enough with statistics. Payments has a whole lot of Hard Problems which seem easy at first, it's a great area.

[cornholio]

Now you are just confusing consumer protection with having a secure online payment system, which credit cards are not and never will be. The entire "transaction approval" shtick is just a bandaid for passing a static password around in clear text, your credit card info.

Consumer protection deals with chargebacks after the payment was made and the products/services are not delivered to required standards. This gives enormous power to credit card companies against merchants and enables obscene rent extraction against consumers who don't require it, yet still pay 2-4% more on everything they buy, even with other payment methods.

[whatagreatboy]

Consumer protection can still be separate in this case. That's not a problem at all. The only reason it is not prevalent in these countries yet is because they in general have lax consumer protection laws. But this can easily change. The unified payment interface does nothing to exclude it.

[Loughla]

That's not really what I asked.

What happens if a fraudulent charge happens?

[crazylogger]

If payments are always approved by the payer with their PIN / FaceID, then the idea of a fraudulent charge is just undefined.

Like you hand cash to someone. The transaction is done at the moment money changes hand. You don't get to call someone to snatch the money back to you against the payee's will.

For online purchase, for example, buyer pays the marketplace (e.g. taobao.com) to temporarily hold the money -> seller ships the goods -> buyer confirms goods are received -> marketplace pays seller. If there is a question, you take it to the marketplace to sort things out according to marketplace & seller policy. Either way, the payment provider doesn't concern itself with any of this - it only routes money according to payer's request.