

Ask HN: Why do we need Visa/Mastercard in today's world? - yalogin

Visa&#x2F;Mastercard are just networks that facilitate communication between the acquirer and issuer. More like the manager in the movie Office Space. So why do we still them, I mean Visa&#x2F;Mastercard? Its 2014 and every server is connected to everything else and what can Visa still provide? Do they actually provide value or is it a giant marketing success now?
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Someone1234
If fraud wasn't a thing we wouldn't. But since it is a massive PITA, having a
middle-man who can help detect and combat it is useful.

Fraud costs everyone (merchants and customers alike), so every time a
fraudulent transaction is blocked everyone except the fraudsters "wins."

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yalogin
The banks build and maintain the infrastructure to fight fraud and not
Visa/MC. Its a massive PITA for the banks and so I get a call from the bank
when there is a suspicious transaction not Visa.

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Someone1234
Banks may have their own infrastructure but they can receive fraud alerts from
upstream, and transactions can be blocked before they even hit the bank.

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jordanpg
This is sort of like walking into a building with several billion computers
wired together with ethernet cables, token rings, and fiber, and asking "Why
do we need all this cabling anymore? Let's just skip the middleman and replace
it all with wireless."

VISA and MC make it their business to make sure they are an absolute essential
part of the transaction, if not in principle, in practice.

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yalogin
Exactly. I cannot be the first person to ask that question. Hence trying to
understand what the reasons behind it are. What exactly makes Visa and MC so
essential. What do they offer that someone with big pockets (or a consortium)
cannot upend?

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j-shoe
Visa and MC (as well as AMEX, JCB and Discover) provide the issuing of cards
and recording of all the cards for use. I would consider them a form of
governing body similar to ICANN of internet (maybe bad example as not everyone
likes ICANN)

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drivingmenuts
Not everyone likes Visa or MC either and I'd be willing to bet they're are
much better known and thus much more hated.

