From: "Vladimir Z. Nuri" <vznuri@netcom.com>
Date: Fri, 17 Nov 1995 04:39:59 +0800
To: Simon Spero <ses@tipper.oit.unc.edu>
Subject: Re: credit card conventional wisdom (fwd)
In-Reply-To: <Pine.SOL.3.91.951115184015.18971A-100000@chivalry>
Message-ID: <199511161923.LAA10460@netcom3.netcom.com>
MIME-Version: 1.0
Content-Type: text/plain



>Card Imprints taken with no online authorisation are typically charged a 
>transaction fee of 3-6%: with authorisation, 1.5-3%.  ATM card 
>transactions  are charged at around $0.10 per transaction.

are you saying that a typical mail order credit card transaction has
a 3-6% charge, because the card is not physically present?

this is a rather shockingly high rate.

again, what I have been calling the "fraud tax"-- it's hidden in every
purchase we make, and when we increase credit card security it will
increasingly be dissipated. but the problem is that no one realizes
this in general, and will argue, "why should we do anything to prevent
fraud? we are already not paying for it right now, why should credit
card companies spend any money to prevent it?"

BZZZZZZZT

I suspect these invisible fraud taxes are quite significant in general
and someone could really become very wealthy by inventing a system that
decreased them.

you might increasingly see retailers offer a "safe card discount"--
some brand of credit card charges them less transaction overhead, and
they pass these savings onto the customer.

or, the credit card company could send the money back to you like 
Discover does.