It could give cashback if it cost 3% of the transaction. But it’s it’s actually much cheaper. For credit cards you have to pay for the brand, the issuer and the acquirer. And each gets a nice cut.
Reducing merchant fees seems like a mistake if you are in competition with both cash (which has high intrinsic merchant costs) and credit cards (which has low intrinsic costs, but which are padded so they're closer to the costs of cash, with consumer cashback coming out of this padding). I'm certainly not going to _choose_ to receive less cashback, as a consumer.
Pix costs are very low and the fee for the merchant as well. They pay less for it and get the money instantly. That’s why many small merchants only accept pix and some big merchants offer discounts for payments using it.
Discounts for Pix vs cash sound cool and a fine alternative to cashback via the payment system. Though I can imagine this might be hard in some countries, where there is a strong pro-cash lobby.
I mean, the cashback is paid for out of the fees you pay for the service. In a world with low capped charges (EU etc) then you'll just pay less, which is equivalent to cashback and much fairer.
So long as the price is the same for cash and card (and Pix?), then you should pick the one that gives you the best kickbacks. I don't think capping CC fees will actually lower prices for consumers much (because merchants prefer round prices for psychological pricing). For evidence, see the fairly uniform pricing of products sold in euros between countries, despite varying vat rates between eurozone countries.
> see the fairly uniform pricing of products sold in euros between countries, despite varying vat rates between eurozone countries.
Huh, not sure I agree with that (the uniform pricing thing). I mean, one should believe that, but it doesn't appear to be true. For example, recently I saw a tablet for 208 euro (converted from GBP) on amazon.co.uk, approx 220 euro from amazon.de and 360 euro from amazon.ie, for the same item.
I was really surprised because I figured electronics would be pretty similarly priced across the EU/UK, but apparently not.
Yes. But credit cards have high costs for the merchant. Thats why they get to give us cashback. It depends on the country, but the cut rate goes from 1% (in europe) to 3% in Brazil.
And the merchant gets the money after a long time. It is possible to advance the payment but the rates are much higher (10%+).
So, i dont think we can even think of credit cards as instant payment. And it has mich higher costs that, in the end, go back to the consumers.
Im not op and I’m not sure they are using it for money laundering.
A money launderer can use a marketplace by creating a seller account and buying from himself. Since he’s the one buying he doesn’t need to deliver anything but he gets the money from a legit source. Usually he would use a payment method as close to money as possible so that it leaves less traces. But in OPs case, the amounts are low so he needs too many transactions to get something valuable. And because of the disputes, he’s (probably) not getting the money (?).
It could be card testing: the fraudster has a bunch of cards and doesn’t know which is valid or canceled. The best way to find out is to test in a real site. So he’ll test out each of them and the ones that go through are good to use elsewhere. The thing is that it would be better for him not to dispute the transactions so the OP would take much longer to find out about the scheme and shut it down. It’s better to use low amount transactions in this case so it doesn’t use too much of the credit available for him to defraud and probably doesn’t warn the card owner.
Another option is doing it just to hurt the OP marketplace. If you have too many disputes the brands can fine you and if you don’t solve the problem they can turn your account off. I’ve seen it happen when a competitor was trying to hurt the e-commerce. It’s a low move and rare but it happens.
One thing that might help is to analyze the sellers too. In a money laundering and even in the other settings, it could be part of the scheme. Are they new accounts? Are their volume exploding out of nowhere? Etc
> Since he’s the one buying he doesn’t need to deliver anything
This only works (in my mental model), when you produce the product you're selling in-house – like a digital product. But lots of "reselling" type businesses try to use this scheme as well. Like a restaurant might ring up more meals than they served, or less to not pay taxes. But, is this not easily spotted when the food import(?) cost doesn't match the revenue?
Maybe I just answered my own question, if the business is able to cook the books both ways, but it would also limit how much they're able to launder. Or is the import/export balance rarely/never checked?
That's why popular businesses for money laundering are car washes and nail salons. They're mostly cash based, and have very little in the way of inventory, so it's easy inflate your sales.
I'd think a video game arcade, especially one with laser tag, would be the best option.
Especially if you stick with quarters instead of using game cards like most modern arcades. Since quarters would be recycled anyways (Taken from the games and restocked into the quarter machine), it makes it easy to just deposit the cash you want to launder as if it had been fed into the quarter machine.
It's pretty easy to figure out max capacity of any of those businesses. Audit the traffic and compare against reported figures. So yeah, you can get away with it, but can't go overboard. It's safer to just waste some high margin inventory to keep. A bar I used to go to was a ML operation and they would just ring in lots of expensive drinks throughout the night and then the boss would come in and settle up the registers. No matter how much I drank my tab was always $20. The same was true for pretty much anyone that was a regular. It was great because it was definitely impressive to order a round of patrons shots for everyone at the bar. On a busy night there would be a couple instances where the DJ would bring up one of "the guys" and let him announce that the DJ was gonna play his 3 favorite songs and while they were playing everybody in the bars drinks would be on him. Very fun.
But a car wash uses water and a nail salon hires workers. Shouldn't take long to check that those numbers don't add up with what was sold at the end of a month.
Maybe. If you calim to wash a million cars but only wash a thousand that will be obvious, but 10 washes different is lost in the noise. Nail salons are easier because you can have the expensive personalized service that no real person buys but if someone investigates you will give it to them.
More likly the above are selling something illegal though. Pay for the expensive hand car wash but get drugs instead with a cheap automatic wash - nobody will know the difference.
For higher valued goods they use horses. A saddle can go for $30,000, so you buy some $1000 saddles and sell them for $30,000 and $29,000 worth of something else.
They will gladly send water down the drain if it threatens their enterprise. Besides, you have to be on the burner for huge crimes if law enforcement is going to care enough to audit water usage. Again, minor piece of circumstantial evidence in any case.
The gentleman who owns the nail salon in my Midwest suburbia strip mall drives a Lamborghini. One wonders about the immigration status and compensation structure of the nail techs.
That’s true for the moment, specially because you’d need an agreement between both countries.
But payment processors in Brazil are already offering “international pix”, that Brazilians can use to pay foreign companies. It’s the same experience as pix for the customer but behind the scenes the company deals with the cross border payment.
You'll be happy with either. Bishop's approach is historically more mathematical (cf his 2006 PRML text), and you see that in the preliminaries chapters of Deep Learning, but there's less of this as the book goes on.
I've read chapters from both. Much overlaps, but sometimes one book or the other explains a concept better or provides different perspectives or details.
Maybe the book it’s just not for you. It doesn’t mean it’s not for anyone.
I understand that deep learning is all in vogue now. But when I was in graduate school, a professor asked me why I was using neural nets in a project since it was not as good as SVMs. We used to study Vapnik and VC dimensions, SVMs etc. and neural nets were totally out of fashion.
Imagine what would have happened if everybody were using and researching only those methods because they worked better. And deep learning could benefit from a theory that explains why, when and how it works so well. Maybe someone working on this could develop on it to include it.
Also I don’t think you’re right to assume that all models out there are deep learning models. Yes they are very good for many cases (specially those with less structured data, like image or nlp). But in some cases gradient boosting or even GLMs are better suited for the task (because of the structure and size of the data or because of computing restrictions).
And in the end, people can just want to learn it because they find it interesting.
It’s a bit sad to do only things that are “useful”. That’s my 2 cents.
This looks interesting. Does anyone knows how it compares to other learning theory books like foundations of machine learning [1] in terms of depth and approachability?
I think that maybe we underestimate how hard it is to choose the right companies to “kill” when you’re a competitor. The default mode is to say that they won’t go anywhere because of many factors (they don’t have the resources, the access, the capability, etc). But sometimes they do. And in restrospect it’s obvious, but it’s not by the time you had the chance to stop it. And I think it’s probably good.
Also hard to marshal the resources you need internally to "kill" a competitor. Sometimes the way to handicap a startup rival is to build the feature / product yourself, but then the bigtech firm runs into the challenges of moving a large org quickly.
