Originally Posted by
bigmouth2008
I still don't understand why WM would try to eliminate these transactions? I mean, if it's a debit transaction, it will be a cost of $0.05 or less per transaction (due to Dot Frank Act, all debit transactions fees are capped at low rate, unlike credit cards that varies between 1% to 3%). WM is so large, it probably has its own clearing house and payment system, so the cost will be even lower. So it really is not a economic loss for them.
The only logical answer would be that they are worried about certain risks such as fraud. I mean, even if they are not losing money by allowing this, they certainly aren't making money either. So why take on the unnecessary risks?
First, for fees your estimate is far too low even after Dodd Frank
Here
Wal-Mart is paying $0.45 or so per $500 in interchange fees. Plus MoneyGram is going to be getting a cut of the money order fee for actually processing the MO. Nevermind fraud loss / employee wages.
Definitely a net loss.
This was always the case even before we started doing this, but it was used as a way to get people in the store. If they are going to the Money Center, chances are they are going to do other shopping as well.
MSers have a tendency to go in the store, to the money center, and back out from what I've seen. We are by and large a parasite to merchants. But we are a parasite that is hard to eliminate without affecting actual profitable customers.