The Wallaby Card

https://walla.by/the-wallaby-card

by theuri • 13 years ago

254 177 13 years ago

walla.by

alternize• 13 years ago

so, what's their business model? data mining?

gesman• 13 years ago

Hacker News suddenly got under attack from onecard and alikes ...

kristoph• 13 years ago

It definitely escalated quickly.

KamiCrit2• 13 years ago

Now we just need a onecard for all these onecards.

jesalg• 13 years ago

At first glance, this seems to have a better value proposition for the consumer compared to Coin.

saadshamim2• 13 years ago

coin takes in debt and gift cards - which is more convenient for me, wallaby seems to be only for credit - I only have one credit card, I didn't even know you got rewards for using them.

nayefc• 13 years ago

Is bonuses such a big problem? I've never had any card had a bonus for a limited time.

RandallBrown2• 13 years ago

My Citi card has special categories that give me double cash back every few months.

fpgeek• 13 years ago

I have several with time-varying bonuses (Discover and at least one other change their bonus categories quarterly and there are other specials for other cards). Beyond that, many of the bonuses have caps and other interactions (e.g. sometimes Discover's bonus on Amazon transactions is better than the original card). Something that manages the transaction routing for me is valuable, even beyond consolidating cards.

derstang6• 13 years ago

Card rules vary frequently, down to daily. Also, many rewards have limits (both min and max). Wallaby helps you keep track.

null_ptr• 13 years ago

Sorry, but ccTLD domain hacks and financial services don't mix well. Financial services should be stable and secure, their front page even embeds a Vimeo video over plain http.

maxvu• 13 years ago

Looks like they fixed it just for you!

kintamanimatt• 13 years ago

Regarding domain hacks: times are changing and it's becoming more mainstream, evidently even for financial services; perhaps only the cooler ones though.

dm2• 13 years ago

I don't think there is a way to fix the https Vimeo issue. It's been a problem on a couple of the sites I've worked on for years and Vimeo acknowledges the problem but refuses to fix it.

sciguy772• 13 years ago

So I've got 3 so far: Coin, Wallaby, and Echo.

Hell, I think I'll build one this weekend, just to be included. :)

antonius• 13 years ago

Seriously. What's with the sudden surge of all of these one-card-fits-all startups?

res0nat0r• 13 years ago

Someone posted Coin, so everyone who knows of already in the works competitors are going to flood the homepage while the getting is good.

cardaggregator• 13 years ago

I'm going to build a service that let's you combine your combined cards

KamiCrit2• 13 years ago

The future right here, looking forward to the IPO day.

sciguy772• 13 years ago

Well I'll get the last laugh because I'll be combining all the card combining combiners.

gbelote2• 13 years ago

Someone posted Loop in another thread: http://www.kickstarter.com/projects/loop/pay-with-loop

While not as close to Coin as Wallaby and Echo, it feels like it belongs in the group. Can't wait to see these all in the wild!

danboarder• 13 years ago

Wow, thanks for sharing. Loop does away with carrying cards entirely and works with 90% of existing credit card readers - impressive.

derstang6• 13 years ago

There is a good history of this:

  1. Dynamics
  2. Geode (deadpool)
  3. Coin
  4. Protean Echo
  5. Omne Card
  6. GoNow Card
  7. Escardgot
  8. CardLab (http://www.cardlab.com/Mobile-Payment.html)
  9. QSecure (deadpool)

elmin• 13 years ago

I don't understand how this could work. How can they 'forward the purchase' to the appropriate card in such a way that the receiving card still sees your purchase as being from a 'gas station', or 'grocery store'.

HelloMcFly• 13 years ago

Maybe similar to how Paypal does it when I pay through PayPal with my credit card?

dangrossman7• 13 years ago

PayPal doesn't do any passing-through. The entity you are paying is PayPal, and separately PayPal is putting money into the recipient's PayPal balance. You wouldn't get a gas station discount even if a gas station created a PayPal account and accepted your card with a PayPal terminal.

gbelote2• 13 years ago

It's impressive to see the collection of Coin competitors hit the HN frontpage and comments today. Best of luck to all of them!

gfosco• 13 years ago

I was more surprised at the incredible amount of buzz generated for Coin as if it were some totally new idea. I couldn't think of the name for most of the morning (Protean Echo,) but I remembered seeing this concept a year ago... Very happy that the others have been posted so people can realize it's not new or unique. As for the idea itself, I find it hard to believe the market for extreme-first-world-problem-users is large enough for any one of these companies, let alone all three. My morning commute photoshop: http://bit.ly/1at9PLO

atwebb• 13 years ago

You don't have to be new or unique, you just have to be better (but no competition would help).

ekorz• 13 years ago

For me, and for many others I'd imagine, maximizing my credit-card-rewards does not trump having control over which account I'm using. Coin is better suited to my needs.

memracom• 13 years ago

No chip and pin? How could this possibly work?

derstang6• 13 years ago

In the US you don't need chip and pin. Look for it down the road.

smsm423• 13 years ago

Interestingly enough, I've just got a new card from one of the major banks and it has the chip. Looks like US banks starting to warm up to this chip idea.

nationcrafting• 13 years ago

Somebody should come up with a service to unify Coin, Echo and Wallaby cards into a single card.

meowface2• 13 years ago

But naturally there should be at least one other competitor for a service like that. Then we'll need another service to combine the two aggregator-aggregators into a single super ultra card.

hack_edu• 13 years ago

Its perfect, and the future business model of 2014:

The product that helps startups help startups that help startups... help startups. Sign up for more details!

gaze• 13 years ago

mustmayostardayonnaise

tehwebguy2• 13 years ago

Hah!

Seriously though, you could link all of your cards to Wallaby and then store all of them + Wallaby on your Coin. That way you could use Wallaby's optimization when you want to or manually choose the card to use.

derstang6• 13 years ago

Wallaby has an API if any of the smart hardware card guys want us to help out!

whatusername• 13 years ago

Obligatory XKCD: http://xkcd.com/927/

dangrossman7• 13 years ago

I'm stumped as to how this can work. The logic can't be embedded in the card, as the card doesn't know what you're charging to it -- the merchant's category code (i.e. gas station, restaurant) isn't programmed into their terminals, that data gets relayed through the various backend networks between banks.

So this can't be sending a card swiper the number of one of your cards, which means it must be a valid credit card itself. It has to be issued by some Visa/MasterCard/Amex/Discover member-bank to be widely accepted, though none of those logos appear on the website's mockup.

If that's the case, I still haven't a clue how they turn a capture against their card into a capture against one of your "real" cards based on the type of store you used it at. They can't be charging your real cards themselves, as all the charges would come from a single category code, whatever one was assigned to their own merchant account, so you won't get the right rewards. They'd also lose money on every transaction that way, as they'd have to pay card-not-present fees to charge your cards themselves, while only collecting lower card-present fees when you use the Wallaby card.

Puzzling. They must be trying to get some kind of relationship somewhere else in the network that no other company has (either direct relationships with issuers, or permission from Visa/MC to sit on the processing network somewhere and do some kind of MITM).

eksith• 13 years ago

I think how it works is that the charge initially goes to Wallaby so the merchant is paid. They then charge the amount taken from Wallaby from one of the listed cards according to where the charge originated from and which deals your listed cards have.

It's a network switch for cards, basically.

RandallBrown2• 13 years ago

I wonder how that works for getting you the rewards and stuff that you should be getting.

If all charges are from Wallaby, how will it know it's a car rental or groceries?

dangrossman7• 13 years ago

If you use your Wallaby card at a gas station, then Wallaby separately charges your card that offers cash back on gas, you won't get any cash back as Wallaby's MCC is not that of a gas station. They'd also have to pay transaction fees every time they charged one of your cards, and those fees would necessarily be higher than any fees they could collect through usage of the Wallaby card. That can't be what they're doing.

abalone10• 13 years ago

Absolutely not. A second charge would result in Wallaby paying extra interchange fees on everything which would kill them. They also wouldn't be able to authorize properly.

A "network switch", yes, but not using that particular method. They must be a real-time MITM proxy.

tehwebguy2• 13 years ago

My guess is deals with the issuing banks / companies.

Here's my thought process: the parties running rewards programs are doing it because they want people maximizing their spend a) on the card, because spending -> interest and b) on the items / shops / etc that they are incentivizing, because they have backend deals (such as being the airline that is incentivized, or receiving affiliate fees from retailers with low costs).

It doesn't even seem too ridiculous to me that they would be able to work out 0 fee / passthrough rates with the bigger players based on those incentives, though it would probably be a first!

21echoes2• 13 years ago

they'd likely be a card processor-- the one who receives the auth request from the swipe terminal and responds with whether or not the charge is approved. they then relay the original request to one of your cards.

ghughes• 13 years ago

Their security page [1] needs some work: apparently they "use SHA 256-bit encryption across all of our solutions" and "your personal account information is never compromised". SHA-256 is a hash algorithm, and it's not very clever of them to state that users' PII is never going to be compromised. Someone with an ounce of computer security knowledge needs to rewrite this page, quickly.

[1] https://walla.by/security

meowface2• 13 years ago

"use SHA 256-bit encryption across all of our solutions"

Would love to see tptacek's reaction to that line.

derstang6• 13 years ago

Good points. We have upgraded our encryption scheme since writing this page. I think trying to explain security to lay people and make them confident is a difficult challenge. We'll get this updated and re-written.

dvetrano• 13 years ago

It looks like this product has been around for a year already:

http://imgur.com/C2A1vYQ

http://vimeo.com/44223249

adamzerner• 13 years ago

The value they offer seems to be: get you the most rewards by using the right credit cards.

I'd like to see some numbers. Are there beta users? If so, how much are they saving? If not, how much does Wallaby predict they'll save their customers? .1%? .5%? 2%?

josephagoss• 13 years ago

Paypass/Paywave? If they can't duplicate chip+pin and wireless payments they will never hit the Australian market.

j15e• 13 years ago

Canada & Europe too!

derstang6• 13 years ago

We need to launch in one market first. We intend to do chip solutions in the future.

jduck• 13 years ago

It's a pyramid scheme! Soon we'll have a meta-meta...meta-n card.

mgambrell• 13 years ago

I would assume most people use cards based what they're associated with (i.e. Business, Personal, etc) not based on rewards

abalone10• 13 years ago

Pretty interesting. Here's my guess at how this works:

Wallaby is both a card issuer and (working with) a processor. The merchant's processor routes the charge to them like a normal card. Then Wallaby selects the appropriate card number and proxys the charge via their own processor to that card's issuer. I.e. the same round-trip transaction, they're just a man-in-the-middle swapping out card numbers. The issuers never see a difference.

Couple issues they'd have to have worked out for this:

1. Getting approval from the card network to proxy a transaction like this. Given the founder's background with Green Dot I can see them having the pull to drive that.

2. Dealing with chargebacks. The merchant will have a record of the Wallaby card number because that's what's swiped through the POS. But the customer will see it on their actual card's bill (let's say Chase). If they file a dispute, and Chase contacts the merchant, there's a card number mismatch. I wonder what their solution is for this. Perhaps they instruct cardmembers to initiate disputes with them and they proxy those as well.

Overall I have to say I like this a little better than Coin, if only because it's simpler. You don't have to make any decisions each time you pay, you just configure it through the cloud, which can actually make smarter decisions for you. And it's not $100.

disc• 13 years ago

This looks like it work great for optimizing/consolidating personal cards, but one advantage Coin offers is the flexibility of charging normal purchases to a business account. I'm not sure how Wallaby could discriminate if my restaurant meal or office supplies are a business expense or just personal use.

Either way I'm all for any innovation that thins out the number of cards in my wallet (with the goal being zero.)

thatthatis• 13 years ago

1) get two wallaby cards, one for business one for personal.

2) put your wallaby card into your coin.

3) carry wallaby and one business card

Today just got too meta. Now my brain hurts.

abalone10• 13 years ago

True. But it would work with all of your personal cards, which is the main proliferation problem.

You could use them together. Get a Wallaby as your "one" smart personal card, and if you feel like springing $100 to go from 2 cards down to 1, you've got Coin.

Personally I'd be a tad worried about handing my Coin to a server to charge a big business meal. What if they accidentally tap the button and switch to my personal card when they're holding it?

nostromo• 13 years ago

Could I put all my credit cards in a Wallaby Card, and then put my Wallaby (and debit and reward cards) on a Coin Card? If so, I'd have just one card (Coin's pain point), but I'd also get Wallaby's "smart routing" for miles (Wallaby's pain point).

dangrossman7• 13 years ago

Even better, get the Loop case for your phone and carry zero cards. It emulates the signal the reader would get from a magswipe wirelessly, so you just hold your phone near the reader. It's supposed to work with credit/debit/loyalty cards like Coin and is shipping soon, not next year.

http://www.kickstarter.com/projects/loop/pay-with-loop

darkmighty• 13 years ago

Not a huge issue but this device likely makes it pretty easy to intercept your mag card data.

vxNsr• 13 years ago

Well technically the part that allows you to pay is shipping next year...

Also this doesn't solve the problem that is being discussed in the coin thread of imprinting and buyer verification for the merchant.

Still, This is the technology that cell phones should be including on a hardware level, not the stupid NFC thing that doesn't work for most US POS. I don't have an iphone or else I'd be contacting them right now asking if I could get in on the action even though I'm about a week late!

What they should do is connect your cellphone account to this and that would allow the carrier verify your identity (if you're on a contract).... I'm sure there's more here that we could do, maybe have an option to silkscreen the your id of choice on to the back of the case...

People this needs to be made to work NOW!! I use the ninja wallet and even that is too big and bulky for me, if I could get rid of the whole thing and just carry it in my phone the world would be a better place!

beachminter• 13 years ago

the wallaby card sounds pretty awesome. i just checked out their mobile app and tested a few places out and the rewards were accurate on my Chase Freedom (which has rotating categories each quarter).

d0m• 13 years ago

As it goes "It's all in the execution", good luck!

lsh123• 13 years ago

Interesting... Suppose it is a Visa card on the frontend and then on the backend I have Amex linked. Will the merchant be hit with Amex fees? Will it be accepted if merchant doesn't accept Amex?

Geee• 13 years ago

I can't understand why you people use more than a single card for payments? That solves all the problems that these Coin and Wallaby cards are trying to address. Rewards are bullshit anyway, I buy stuff from honest companies without any kind of reward systems.

clarky07• 13 years ago

Interesting that every payment card solution but the one that I actually find interesting is on the frontpage right now [1]

[1] Loop - https://news.ycombinator.com/item?id=6737688

pmorici• 13 years ago

With the rise of Bitcoin aren't all these all-in-one credit cards just a Blu-ray player in an iTunes/Netflix world?

ubercore• 13 years ago

Bitcoin has a long way to go in terms of proving security (not algorithm security, but practical "in use" security) and convenience before it it's a Blu-ray/Netflix dichotomy. These last few weeks, with millions of dollars lost in bitcoin hacks reinforces that perspective, I think.

faramarz• 13 years ago

What if i'm doing an online purchase? How do I charge the Wallaby Card when my only options are Visa, MasterCard and American Express.

Really interesting concept. Canada, just get it to Canada!

runn1ng• 13 years ago

I am an European, so maybe it's different in US, but is too many cards problem that people actually have? Judging by the top 2 stories on HN right now, it probably is.

I have a card. It is hooked up to my bank account. It works.

bloometal2• 13 years ago

You mean '3 out of top 4'? There's a "Protean echo" too.

sharkweek• 13 years ago

I have...

a debit card, a credit card, a backup credit card and my corporate card

I would love a positively fail safe solution to get this down to one card, but to be honest, neither of these top stories offer that. Because at the end of the day, the most common reason for failure in my standard use case is user error on my part.

nawitus• 13 years ago

European cards are typically a combined credit and debit card, so that's one less card alraedy.

isaacb• 13 years ago

It's not really an issue for me. I have four cards and don't mind having them all in my wallet. What seems to have happened is a bunch of people with the same idea panicked and put out releases at the same time to avoid looking like copycats.

dangrossman7• 13 years ago

They weren't all put up today, just re-submitted to HN by various people today. Both the Wallaby and Protean Echo sites are from 2012.

skygazer• 13 years ago

Oddly, for me, the killer feature on the "Coin" card is the proximity alarm if you leave your card behind. I've repeatedly left my card at restaurants after paying, or left the house in the morning without my wallet. Err. However, I would hate to have to bring my credit card with me when I go for a jog.

milesskorpen• 13 years ago

I've got a United airlines CC, an Amazon CC, a dining rewards card, and then 2-3 other legacy credit cards without fees, and three debit cards for different bank accounts.

untog2• 13 years ago

I live in the US and I don't get it, either. It can't replace my whole wallet - I see the utility there - so instead my wallet is.. a few mm thinner? With x extra added points of failure?

Zombieball• 13 years ago

So you want a super card, right? :)

Acts as a debit card, credit card, ID / Driver's License, Passport, library card, Costco card, etc.

Wish I could replace my wallet with something like that.

URSpider94• 13 years ago

US card-issuing banks compete by offering varying bonuses for using their card. Typical offers will be 1% cash back or 1 frequent flier mile per dollar spent, but this can flex up to 5X in whichever category that particular card specializes in, often linked to a particular merchant.

If you can shift the lion's share of your purchasing onto rewards cards, you can bank hundreds of dollars per year, especially if you use the card for business travel and expenses. There's an opportunity for that to increase by 2X or more if you can put your purchases on the "best" card.

shawnps• 13 years ago

I used to use my credit card almost every day in America, but now that I'm in Japan I don't even have any credit cards. A lot of places don't accept them, so I just use cash everywhere. The one card I have is a bank card that I use to withdraw money from ATMs, mainly at 7-Eleven. I don't really like having to buy gift cards to use on Amazon, but it's just a minor annoyance.

icebraining• 13 years ago

A nice thing that we have here in Portugal are "virtual credit cards", offered by the banks, which act like a credit card for the merchant but as a debit transaction for the user.

sperez4mba• 13 years ago

I'm european too but I've been living in the US for a few months now and let me tell you I haven't seen in Europe anything even closer to what they have here with the cards. Some people stock rewards/bank/miles cards like who stocks cans of soup in the supermarket.

I know it's not directly related to the consolidation card topic but I even have friends who use their father/mother card using their own signature which I don't think is safe because, even if their parents authorized them to use the card, the usual way to verify that you are really you is through the signature and I doubt nobody checks you signed with the right signature in a greasy reastaurant check, so basically I'm pretty sure anybody could steal your card, use it and you would realize just after seeing the charges on the bank statement.

A consolidation card is maybe a way to solve the problem. Another way which to me makes more sense is not to sign up for every damn card in the country which most of the time end up collecting dust in the wallet.

Andrenid• 13 years ago

Australia here, definitely wouldn't catch on (IMHO). Nearly everyone I know just has 1 major card, their primary bank card, which works as a debit and credit card in 1. Some people (like myself) have a 2nd card, a credit card for major purchases, that has better interest rates etc, but that one isn't used as much.

Most the other cards we carry aren't bank cards, they're Medicare (if we get hurt), drivers license / ID, and RFID cards to get into work or your apartment building (I have 2 of them)... and all these cards, these "one card" startups can't replace.

Unless they can replace my entire wallet with a single card, that works as a drivers license, medicare, debit/credit card, and RFID card for my house, then you're not really offering anything special.

abalone10• 13 years ago

Australia is a regulated market that abolishes the high interchange fees that power the reward programs in the U.S. This is specifically for the U.S. market.

SyneRyder• 13 years ago

Another Aussie here, and I could maybe be interested. I typically carry at least 3 cards on me: credit card, AmEx, separate bank keycard / debit card, plus coffee loyalty cards. I can't always remember if a store takes AmEx (high Frequent Flyer point earnings), or if they do take AmEx but impose a 3% surcharge (negates the FF points benefit). It would be nice to have just one card, that automatically knows the best card to use at each store.

But without support for PayWave / PayPass / Chip & PIN, it's DOA in Australia. I want a card I can use when traveling to Europe as well (requires Chip & PIN). And Coin has a sleeker Uber-esque look to it as well - that rainbow on the Wallaby card doesn't exactly say "luxury" or "exclusive". (Not that it has to be, but it'd be nicer to drop a black / carbon card as an early adopter, not a plastic thingy called "wallaby" with a rainbow.)

Pxtl• 13 years ago

Kind of ironic given the name.

nraynaud4• 13 years ago

I would say there is a difference in mentality, from what I have seen in the US, they like to hoard stuff, and they always take credit for everything like there is no tomorrow.

They don't really have this idea that you should avoid credit, and should you take one it should only be for (hopefully) productive investment, they buy TVs, clothing and food with credits.

Not uselessly using borrowed money for everything can actually hurt you the day you actually need to borrow money because they will consider your econ. 101 attitude (save before buying if it's not an investment) a "risk".

IgorPartola5• 13 years ago

Credit card != debt. Please stop trolling.

abalone10• 13 years ago

The reason is U.S. banks have been getting creative with reward programs lately. They entice you with "5% back on gas" or "100,000 points" which all seems very grand. So naturally us nerds want to hack the system for maximum profit.

The reality though is that these programs are not sustainable if fully exploited. Interchange (the fee U.S. merchants pay when you run a card) is under 2%.* A bank can't reward you more than that without losing money. Well, they can make up for it on the interest they charge on debt, but presumably if you're optimizing cards then you're optimizing where you hold your debt too. The way banks make these programs viable is with marketing, tricks, rules, time limits, etc. that make you think you're doing better than you really are.

Smart consumers figure it out. But not everyone bothers to, and so there's enough "dumb" ones to make it possible. Kind of like how gym memberships work.

Long story short: If a service like Wallaby takes off and levels the playing field, then these programs will disappear. So if you're one of those "smart" consumers that enjoys exploiting cards to make an extra buck or two, then you're better off not rocking the boat.

*Europe's interchange is a fraction of that, which is why you don't see this rewards phenomenon there.

Aqua_Geek• 13 years ago

Isn't the interchange fee higher on some rewards cards?

Flenser2• 13 years ago

Santander UK give 3% on fuel, 2% on department stores and 1% on household bills. It looks like Lloyds are going to introduce a similar scheme soon too.

the_watcher2• 13 years ago

I have a decent number of credit cards, but most of them are cards that I opened and just used to hit the minimum spend, claim my signup bonus, and then go back to using my regular credit card that has the best day to day rewards (I also only open cards that waive my annual fee, and cancel any that try to make me pay to keep it open. Keeping them open for free is good for my credit utilization and age). Sometimes, however, a specific card will offer 5x (or something similar) on certain categories for a limited time. If I could give Wallaby detailed information about how I value rewards, it would be nice to just have one card that I carry around.

I pay all my credit cards off monthly, and basically treat them as cash (so I'm not the target consumer of a rewards card, I know).

wldlyinaccurate• 13 years ago

I'm living in the UK right now, and I'm the same as you with having only one card. However most of my friends have several credit cards, which I find really strange. I wonder if it's a symptom of how broken the economy is... It's too easy to get multiple credit cards and use them all to pay each other off, so you're essentially living in constant debt.

bruceboughton• 13 years ago

I don't think it's a symptom of "how broken the economy is". If you're paying each off when it's due, it can be a good way to make a small chunk of change.

arethuza• 13 years ago

Well, I have a debit card - which I use for pretty much everything that isn't a business expense. I also have a personal credit card which I use very occasionally in situations where a debit card won't work (e.g. getting Euros from a ATM in Schipol airport) and an "emergency" personal card that I use in situations where neither my debit or main personal credit cards work (about once a year so far).

I also have a company credit card.

Semaphor• 13 years ago

I do have several cards (even if most of them are rarely used). I think a big difference is, that we still have coins. I see all those wallets on kickstarter that are useless for Europeans as they have no space for coins.

I'd want a single card and I'd want one of those sleek wallets if all I had were cards and bills.

dalore• 13 years ago

I'm European too (if you count UK, some don't), and I have way too many cards, like 30+. I've add to trim down to 4 and keep some more in my bag. Tried some of the apps that let you put in the cards and it shows a barcode, but that barcode doesn't always scan on some of the barcode readers so you actually need the card.

taude• 13 years ago

It's not just the credit cards....that's the easy problem to solve (especially with so many alternative pay methods at the moment),

neil_s2• 13 years ago

Living in the UK, I have only 1 debit card, which works just fine. I don't need to build a credit history and credit cards don't offer much in terms of rewards so there's no incentive to live in debt instead of only paying for what I can afford.

What is the problem is all the loyalty cards. I sign up for any loyalty cards even if I don't plan on going back. Design a way for me to have all of them on me, and remind me to use the right one when I'm in the location, and I'm sold. Currently I just leave most at home, leading to under-utilization without careful planning.

rexreed2• 13 years ago

I'm a single data point, but no, it's not a problem I have. My wallet is thick, but getting rid of the charge cards (only) in my wallet doesn't solve any pain point I have. But then again, Snapchat doesn't solve a problem I have either, and somehow they're worth Billions, so what do I know?

adkk• 13 years ago

Personal debit card, business debit card, personal credit card(s), business debit card. Loyalty cards, gym card, even drivers license (although the magnetic stripe for the drivers license is of limited use - airports and car rentals)

thomasjames2• 13 years ago

If you do not have at least two cards here, you do not understand how the domestic credit bureaus work. It is a major factor in determining your credit-worthiness for everything else you do. In countries with higher levels of home ownership and expensive education, it matters a lot, and it is not necessarily all about using them for consumption.

bhaile• 13 years ago

Launched in Summer of 2012. https://news.ycombinator.com/item?id=4161916

I had signed up and was in the second batch of users. First 1,000 users got it for free for life. Next batch got it one year for free.

I never got the card though. Something related to demand was too high and then nothing.

cantrevealname2• 13 years ago

Slightly off topic, but it's sad to see so much brainpower and energy go into "innovation" in the financial sector.

We (society) have created a complicated game involving credit cards and we have to continue playing the game otherwise we lose. Merchants charge higher prices because they need to pay a 2% merchant fee, then the credit card "rewards" us with 0.5% back. Madness.

If the blizzard of credit card features--cash back, reward schemes, loyalty plans, interest options, perks, airline points--all disappeared, it would be a huge net benefit to society.

I realize it won't get fixed. It's sort of like simplifying income tax legislation. Almost everyone would benefit even if the amount of tax collected remained the same, but there's no mechanism to even start doing it. Same thing here with the credit cards.

a2kadet• 13 years ago

I'm pretty sure loyalty programs are good for the smart consumer. I would speculate credit cards were all competing with one another while charging a 2% fee. They all wanted to go lower but couldn't and needed something to compete. Enter loyalty programs, designed to attract your attention but be too confusing to actually use.

TL,DR - I would guess cutting loyalty programs wouldn't lower credit card fees.

dangrossman7• 13 years ago

The interchange rate charged by the card network (Visa, MasterCard, etc) is determined by the type of card presented. Rewards cards are charged a higher fee because they're reward cards (the rate is literally called "CPS Rewards"), and that extra money ends up back with the card-issuing bank who's paying the rewards. If you head into your local convenience store and pay with a cash-back card, that store will lose a larger percentage of your transaction than if you had handed the very same cashier a basic non-rewards card.

http://usa.visa.com/download/merchants/visa-usa-interchange-...

abalone10• 13 years ago

That's a good way of putting it.. "we have to continue playing the game otherwise we lose."

But we didn't create it. Visa and the banks did.

Visa was able to win over so many banks by offering the highest interchange fee. Remember, card network customers are banks, not you, so they're actually competing to raise the fee that merchants pay (interchange) that gets passed back to the bank that issued the card. In a masterful example of leveraging network effects, Visa was able to come up with the highest fee that still had wide acceptance by merchants.

This pissed merchants the hell off. Theoretically it may have increased prices by 2% in general, but it's hard to say. That's part of the "genius" too, it's designed to be a small enough fee to be a rounding error that merchants just eat.

It did have one advantage for consumers: it made Visa accepted absolutely everywhere by further driving its network effects. (And Mastercard too which followed the same model.) As compared to networks like AmEx or Diner's Club, for example.

What happened then is the banks started competing with one another with reward programs. This basically took the margin out of the interchange and returned it to the consumers. But only if they "play the game" and know how to play it well.

So what we're left with is a silly game consumers have to play to get their 2% back, which merchants really hate.

This has been "fixed" through legislation in other countries. Australia for example. But guess what? They did a study and found that merchants did not lower prices. They just kept prices the same and enjoyed an extra 2% margin.

mattmanser• 13 years ago

You are wrong for thinking that these innovations aren't helping society.

Even a brief thought about it and you can see this is much better than having to go to your bank, withdraw a large sum of money, walk to the shop with that large sum of money.

It helps business, reduces the transaction friction.

I once actually pondered that wouldn't it be much better if the government controlled internet search rather than google. Fairer? Less open to their constant land grabs from other aggregators? No advertising?

Can you imagine what a nightmare that would have been like? What a silly idea that thought was?

That's essentially what you're saying about a different industry.

cantrevealname2• 13 years ago

go to your bank, withdraw a large sum of money, walk to the shop

I was speaking about frilly credit card features that force us to play a complicated game where we pay more for stuff and then get some money back by signing up for the right "reward" card or collecting points or miles or whatever.

Obviously, I'm not suggesting that everything should be cash. Electronic payment systems (credit/debit cards, wire transfer, Paypal, hopefully Bitcoin) are essential of course. (Often badly implemented, but essential.)

smsm423• 13 years ago

You don't understand why tax code is complex. It's not complex because we don't know how to make it simple (that may be true but that is not the real reason), but because politicians explicitly do not want to make it simple. Making it simple would remove a very powerful way to control behavior from them, and if politicians of (almost) all shades hate something equally it is not being able to control something. The tax code is complex because it's not only tax code (i.e. means of extracting money from people to fund the government) but a vast regulatory engine.

Credit card rewards are complex because competing on price only is hard and brutal and if you're dealing with commodities - and credit card access from the issuer side is commoditized - it drives your margins down into unsustainable territory pretty quickly. So people invent all kinds of schemes that they can compete on without getting into direct price competition. I don't see how removing this would be a huge net benefit to society. I like getting 2% back from my every purchase and 5% back from certain ones. Yes, I know these are the same 2% the merchant is charged with, but credit card companies won't work for free. So I have a choice - either they charge merchants less and don't care about me - i.e. don't entice me with rewards and so on - or they charge a bit more and give it back to me as a reward. I personally like it better when they compete for my attention - that's kind of a relationship that usually leads to a better service than "you're not the one actually paying us so we'll take your call in next 2 hours or so".

PeterisP• 13 years ago

It's not that "almost everyone would benefit".

If we magically switched a perfect/lowfriction payment model, merchants would benefit, and consumers would benefit, but in ways invisible to them; while losing smaller visible benefits - so they wouldn't "see any benefit".

On the other hand, all the infrastructure partners - i.e., anyone who actually can change the system, would lose out on this lucrative rent from the transaction fees.

The only way to change that is by force from above - EU SEPA legislation is in the right direction, but IMHO not enough.

saadshamim2• 13 years ago

The main problem with cards, isn't necessarily the number, rather the speed. Nfc is the fastest implementation so far and both my credit and debit card have it, and I will gladly carry around an extra few millimetres in my pocket to speed up the transaction process.

logician76• 13 years ago

At Costco, you can only pay with American Express and at their gas station and store register, the card also doubles as a membership card, so since they don't explain how their card works I doubt that it would work for Costco.

mikegagnon• 13 years ago

The problem with the world isn't too many physical credit cards. It's too many lines of credit.

CmonDev• 13 years ago

A Belarusian start-up? Nice!

thomasjames2• 13 years ago

I was thinking the same thing. I wonder if there are any consequences to having Belarus have domain over your--well--domain. It is a modern country with a well educated populace, but its government is Europe's last dictatorship. I imagine there aren't consequences, but you have to wonder if the founders considered any of the legal issues with spinning the globe to find a country with a matching top-level domain.

OafTobark2• 13 years ago

I signed up for one way back and never heard from them. Not going to bother now.

SumantChhunchha• 13 years ago

WallaBy + Loop will make a good combo - put all your cards in one WallaBy card and put one WallaBy card in to Loop. So your phone will have only one card and your point of control will be WallaBy. Hiding all other cards details - block one card and you are safe. Coin card is not going in the right direction i feel. Time to loose the card stuff now...

talhof8• 13 years ago

Am I the only one confused about this coincidence?

joetech• 13 years ago

Great concept, but I don't know how comfortable I am giving them access to all my accounts when all they do for me is choose which card to charge. And how do the purchases show on my card statements? Are they all from Wallaby now?

ryanjm33• 13 years ago

Sounds like one of the top stories from yesterday:

[Coin a step in the wrong direction](http://www.techendo.co/posts/coin-a-step-in-the-wrong-direct...)

mkramlich• 13 years ago

This is getting to remind me of XKCD on standards. The wonderful thing about having too many standards is that somebody comes along to create a new standard intended to unify and replace all the other ones. Then you have N+1 standards to choose from.

That said, I do think adding an extra level of indirection to any customer/merchant transaction event is a Good Thing. Allow the customer to pay in any manner he chooses that otherwise satisfies the merchant. While doing so in a way where the customer can be confident his payment identity/authorization is not hijacked and repurposed, or reapplied, or TRACKED, without his permission or knowledge. We still seem to be in this era where POS payments are catching up with what software engineers knew at least decades ago would be a smarter solution.

rexreed2• 13 years ago

I wish I could see some customer validation videos where they went on the street and asked random consumers and merchants if they would find this product (and Coin and others like it), useful as well as hear their concerns. Since I doubt that sort of customer validation work was done in that way (random users vs. specific focus groups, if at all), my impression is that it would be a video full of people saying "eh, maybe, but what about..." or "no, I don't have that problem" or "yeah, it's interesting, but I don't use my card(s) that much or in that way"... or "yeah, but I won't pay extra for that" or maybe "sure, I like it as a consumer" or "sure I'll accept that as a merchant".

The Wallaby Card

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