> > As long as you publish the user statistics on your site, both for the > > buyers and the merchants, the fraud will be kept in check. ... > > Pretty quickly the frauds will have effectively disqualified > > themselves from your system. > > Yes, but again, what is to stop a fraud ring from suddenly attacking a > particular merchant, buying up a bunch of electronics equipment, > charging it all back, and then fencing the stolen equipment on the > street? Suddenly that merchant's statistics will look pretty grim. > > Wouldn't it still be helpful for the merchant to be able to submit > proof of receipt of goods to preempt chargebacks like this?
Well, certainly at least you could provide the merchant with the possibility of having his statistics cleaned up by providing proofs of delivery. And nothing stops you from offering different options as far as the chargeback possibility goes. You could have the merchant choose between 'chargeback no questions asked' (would have the lowest fees of course), or 'chargeback upon sent back of the goods' (this will have higher fees and you will need a complaints department) This is just filling in the details of the system, I have only outlined the main principles. > > > It would be nice if we could replace "Equal Risk" with "Lower Risk," > but I don't think that case can be made. There is lower risk because there are a few other types of fraud the ordinary CC system is suffering from, and which won't occur in a repudiable e-gold system. CC have the problem of lost or stolen cards, and they need a round the clock telephone service set up, so people can have their cards locked as soon as they find out their CC was lost or stolen. It is probably this fraud that is absorbed by the CC company, but then again you can be sure the merchant is paying for it too as this is calculated into the CC fees. This won't happen with repudiable e-gold of course, because there are no cards to loose or steal. Another problem with CC on the net is that somebody else might acquire your CC details (for example because you bought at his shop), and simply use it for his own online purchases which have instant or electronic delivery, using a false delivery address and untraceable email. Of course the original owner of the CC will chargeback the payments, but the merchant has sent out the stuff already and cannot identify the cheat. With repudiable e-gold again this kind of fraud cannot become a problem, because lost e-gold passphrases are beyond your responsibility. So you will definitely have lower risks and lower costs. Really easy to beat the CC at their own game with a much more transparent and flexible service for the users... > Equal Risk + Lower Fees will > pretty much have to suffice, and that alone (if true) might help the > idea fly. I think even Equal Risk + Equal Fees would fly because there are so many people out there who do not qualify for creditcards, and would like to have possiblity to buy on the net with the protection that creditcards offer. The fact that so many people sign up for the different e-gold to plastic offers out there, shows that apparently many do not care to loose 5 or 10% on it. This just shows how big the potential market probably is if the aggregate fees would be lower. I guesstimate that a properly set up repudiable e-gold system , which would be mostly fully automated, could probably run profitably for a 3% fee with a maximum of $2 for the 'chargeback no questions asked system', customer mediation can have an extra charge Costs for the provider are: his website and server. 1% with a maximum of 0.5$ is lost when the buyer spends e-gold into the repudiable e-gold system account. Another 1% with a maximum of 0.5$ is lost when the e-gold is spent into the merchants account after the chargeback period expires , or when it goes back to the buyer in case of a chargeback. (There will also be some storage costs for the e-gold that is sitting in the account during chargeback period). So the real transaction costs for provider is always +/- 1% with a maximum of 1$, so his profit before costs would be 2% with a maximum of $1 If the system catches on and a large user base is achieved the repudiable e-gold provider will likely take the step to become independant from e-gold and set up its own gold-storage, inorder to save on these transaction costs. Then he can probably lower his fees for the basic repudiable e-gold to 1% with a maximum of 0.5$, same as the normal e-gold charges today. Regards, Danny --- You are currently subscribed to e-gold-list as: [EMAIL PROTECTED] To unsubscribe send a blank email to [EMAIL PROTECTED] Use e-gold's Secure Randomized Keyboard (SRK) when accessing your e-gold account(s) via the web and shopping cart interfaces to help thwart keystroke loggers and common viruses.
