Ask HN: Why is there no good micro payments service online?
I've always wondered why is there no good service to pay small amounts, 10,50 100 cents, to creators? Similarly to paid content behind paywalls. I often find myself thinking, I would pay a buck to read this article, but I don't want to commit in paying 10 bucks a month.
5 comments
I think about this all the time too.
The problem is that the payment industry is a) heavily regulated and b) has monopoly from the likes of Mastercards and the Visas.
In order for Micro payments to succeed, someone (probably a well funded and connected team) has to figure out how to break through the 2 points and only then there is a chance. This is one of those problems that even though would need software but is more of a "tech enabled" business. Sure we can code an MVP to take "micro payments" quickly but how will they be processed ? If it goes through the usual processors, it doesn't make financial sense and then you have the regulatory stuff to mitigate fraud and money laundering.
It is also a chicken and egg problem. In order for this to work even if you get past my 2 points above, you need to partner with content providers and get all of them to use your centralized service. Sounds great for the consumer (kinda like google pay?) but may not be great for the provider as they are not limited to a centralized aka "I get to dictate" provider.
If anyone is up to solve this, hit me up for brainstorming. This is a billion dollar idea (not joking) but is not something that can be solved bootstrapped unfortunately. This is one of those problems which needs significant VC funding to put together a bunch of connected people and make things happen.
The problem is that the payment industry is a) heavily regulated and b) has monopoly from the likes of Mastercards and the Visas.
In order for Micro payments to succeed, someone (probably a well funded and connected team) has to figure out how to break through the 2 points and only then there is a chance. This is one of those problems that even though would need software but is more of a "tech enabled" business. Sure we can code an MVP to take "micro payments" quickly but how will they be processed ? If it goes through the usual processors, it doesn't make financial sense and then you have the regulatory stuff to mitigate fraud and money laundering.
It is also a chicken and egg problem. In order for this to work even if you get past my 2 points above, you need to partner with content providers and get all of them to use your centralized service. Sounds great for the consumer (kinda like google pay?) but may not be great for the provider as they are not limited to a centralized aka "I get to dictate" provider.
If anyone is up to solve this, hit me up for brainstorming. This is a billion dollar idea (not joking) but is not something that can be solved bootstrapped unfortunately. This is one of those problems which needs significant VC funding to put together a bunch of connected people and make things happen.
Well plenty of options exist:
[1] Brave Browser - A browser that monetises your attention in Basic Attention Tokens... personally I think this is a weird solution and has many problems
[2] Steemit - A community which allows you to pay/earn by contributing... also a weird idea, prone to abuse and bad motivations
[3] Metamask - A browser extension which integrates crypto currency into your browsing experience. Allows you to pay a website small payments... this is probably the closest solution to your problem, but I find it a bit cumbersome and confusing to use.
The reality is that it's just not a popular problem that people need solved. Content creators don't really care about a 10c donation, they'd rather optimise for the 10$ donations.
Also, the micro-payments are almost equivalent to just showing ads on the site, but I guess everyone disables those now...
[1] https://brave.com/brave-rewards/
[2] https://steemit.com/
[3] https://metamask.io/
[1] Brave Browser - A browser that monetises your attention in Basic Attention Tokens... personally I think this is a weird solution and has many problems
[2] Steemit - A community which allows you to pay/earn by contributing... also a weird idea, prone to abuse and bad motivations
[3] Metamask - A browser extension which integrates crypto currency into your browsing experience. Allows you to pay a website small payments... this is probably the closest solution to your problem, but I find it a bit cumbersome and confusing to use.
The reality is that it's just not a popular problem that people need solved. Content creators don't really care about a 10c donation, they'd rather optimise for the 10$ donations.
Also, the micro-payments are almost equivalent to just showing ads on the site, but I guess everyone disables those now...
[1] https://brave.com/brave-rewards/
[2] https://steemit.com/
[3] https://metamask.io/
There's no margin in micropayments in general due to transaction costs.
And the problem with the 'what if we just get people to put $10 in every month, and pay the content creators in one single payment' approach to solving it is that actually, relatively few people want to do this. Which is the main reason you haven't heard of the companies that do...
And the problem with the 'what if we just get people to put $10 in every month, and pay the content creators in one single payment' approach to solving it is that actually, relatively few people want to do this. Which is the main reason you haven't heard of the companies that do...
Because the fiat fees are too high + kyc as someone said below.
And even crypto is super high too. For example: https://ethgasstation.info/
average ETH transfer: $0.229/transfer
With ETH your fees can be equal to the micropayment itself. There may be other blockchains that are cheaper, but then of course even fewer people use those cryptos, so that 'advantage' that people advocate really isn't an advantage... If you're talking a buck then you could build something that does this with ETH for example, then it would be .229$/1.229$ = 18.63% fee as compared to total cost if you want $1 total sent to platform/creator (seems more reasonable). Or you could just take the fee out of the buck itself, that would be 22.9%.
And even crypto is super high too. For example: https://ethgasstation.info/
average ETH transfer: $0.229/transfer
With ETH your fees can be equal to the micropayment itself. There may be other blockchains that are cheaper, but then of course even fewer people use those cryptos, so that 'advantage' that people advocate really isn't an advantage... If you're talking a buck then you could build something that does this with ETH for example, then it would be .229$/1.229$ = 18.63% fee as compared to total cost if you want $1 total sent to platform/creator (seems more reasonable). Or you could just take the fee out of the buck itself, that would be 22.9%.
I guess that's mostly because there was no way to do it without intermediaries (banks, paypal etc). Which means that a) fees are generally too high to process micro-payments, b) payment processors require KYC and that's too much pain for a single-shot micro payment, plus your privacy is leaking. Some crypto projects are trying to fix this, but I don't think any of them is ready for 'normal' users.