Comments on: Durbin, Dimon, and interchange http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: traducere romana daneza http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-53421 Mon, 29 Sep 2014 13:54:15 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-53421 For any closer (but safer) shave, on your 2nd time about, attempt moving the blade throughout the grain inside a kind of sideways swipe. In the event you hair grows down, shave from left to appropriate (or suitable to remaining). This may offer you a closer shave without having as significantly irritation as shaving towards the grain.

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By: Nylund http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25828 Fri, 15 Apr 2011 15:25:23 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25828 I hope Durbin doesn’t have any secret vices. If Elliot Spitzer taught anyone anything, its that Wall St. has no problem getting dirty when a politician goes after them.

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By: leoklein http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25826 Fri, 15 Apr 2011 15:11:16 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25826 Bring back Postal Banks!

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By: Benquo http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25821 Fri, 15 Apr 2011 13:43:38 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25821 It is frankly inexcusable that your bank would urge American customers to “always select” a fraud-prone technology […]

I think this is a little confused. Legitimate signature transactions do not on their own increase the rate of fraud.

The increased fees per transaction reflect the higher probability per transaction that fraud is occurring. This is because a certain number of debit card transactions occur with stolen cards.

If someone has already stolen the card, they are more likely to use the easier-to-fool signature option than the harder-to-fool PIN option. This accounts for the higher signature fraud rate. But when no one has stolen the card, the probability of fraud is zero. Using the card in an additional legitimate signature transaction does not change this.

So when merchants accept signature transactions unconditionally (i.e. without discriminating between legitimate and illegitimate cardholders) this imposes a fraud cost on the bank, which they recoup with fees.

When legitimate cardholders choose to use signature transactions more often, this imposes no direct fraud costs on the bank, so the extra fees collected are pure profit. The merchants are not so happy about this, but I think they usually have the option not to accept signature transactions.

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By: Benquo http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25817 Fri, 15 Apr 2011 12:25:41 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25817 It is frankly inexcusable that your bank would urge American customers to “always select” a fraud-prone technology […]

I think this is a little confused. Legitimate signature transactions do not on their own increase the rate of fraud.

The increased fees per transaction reflect the higher probability per transaction that fraud is occurring. This is because a certain number of debit card transactions occur with stolen cards.

If someone has already stolen the card, they are more likely to use the easier-to-fool signature option than the harder-to-fool PIN option. This accounts for the higher signature fraud rate. But when no one has stolen the card, the probability of fraud is zero. Using the card in an additional legitimate signature transaction does not change this.

So when merchants accept signature transactions unconditionally (i.e. without discriminating between legitimate and illegitimate cardholders) this imposes a fraud cost on the bank, which they recoup with fees.

When legitimate cardholders choose to use signature transactions more often, this imposes no direct fraud costs on the bank, so the extra fees collected are pure profit. The merchants are not so happy about this, but I think they usually have the option not to accept signature transactions.

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By: Ivan_Karamazov http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25812 Fri, 15 Apr 2011 01:07:23 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25812 “It would be nice if people would just stop using credit and debit cards for a while. What right do we have to complain about the evil banks when we can’t be bothered to take even this modest business away from them?”

It’s not just that they can’t be bothered – consumers are also made to pay fees at ATMs. Credit/debit cards prevent the “is this ATM affiliated with my financial institution?” hassle.

The banks do an awful lot of pissing and moaning for the money they make. It’s like listening to Tony Hayward whine about how he “wants his life back”. Go cry about it…

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By: qmp http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25811 Thu, 14 Apr 2011 23:11:01 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25811 Does anyone know what kind of fees Starbucks pays? They have no credit card minimum, have low priced products, and casual observation makes me think the majority of purchases are done with credit and debit cards.

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By: TFF http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25809 Thu, 14 Apr 2011 22:38:25 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25809 The interchange fees are not borne by the card users, they are absorbed by the merchants (or passed along to their entire customer base).

This is pretty typical for a situation where the benefits and costs accrue to different parties in the transaction.

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By: silliness http://blogs.reuters.com/felix-salmon/2011/04/14/durbin-dimon-and-interchange/comment-page-1/#comment-25806 Thu, 14 Apr 2011 21:02:33 +0000 http://blogs.reuters.com/felix-salmon/?p=7944#comment-25806 It would be nice if people would just stop using credit and debit cards for a while. What right do we have to complain about the evil banks when we can’t be bothered to take even this modest business away from them?

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