Yosemite X a firm which developed a public blockchain based of fiat currencies have announced their latest credit card services with a 0% transaction fee. The move is quite surprising given the fact most of the traditional players have been increasing the prices for transaction fee lately.
The announcement for the new credit cards came on March 22, and the company is hoping to garner a much wider user base with its latest move. The zero transaction fee credit cards aim to cut down the unnecessary fee charged by a number of central banks and traditional payment portals like Visa and Mastercard.
The card promises to save 2-3% in annual savings on transaction costs for merchants like Palo and Alto which has given support to the Yosemite X 0% credit card. The saved cost from the transaction fee would be re-directed to the users in the form of various rewards and bounties, hoping to change the way people look at credit cards and fiat payment portals.
The Move Towards Digital Economy Might plague the Progress of traditional Players Due to high transaction Fee
The world is moving towards a cashless digital economy, and even though cryptocurrencies are proving a big contender for the future of finances, even the fiat-based systems have been moving towards digitization. As the traditional players are gearing up towards a future without physical money many believe that a huge transaction fee can become a big roadblock.
According to a news report, the credit card purchases using Visa and MasterCard in 2018 amounted to a whopping $2.77 trillion, even if we take 2% as the average transaction fee, then the collected fee stands at $55.4 billion. These whopping transaction fee adds to the cost of the product and makes it less feasible for the consumers.
Why Traditional Players Charge Such a Large Transaction Fee
Many believe the traditional players did not incorporate the technology with time to keep a check on their huge transaction fee. Apart from that, the monopoly and lack of any competition did not really give these traditional payment portals a reason to go for a change.
Here is what the founder of Yosemite X has to say about the huge transaction fee charged by the traditional payment giants like Visa and MasterCard,
“The card payment industry is following an outdated model that is hurting merchants and consumers, and we saw an opportunity to provide a tangible solution to both, With the development of technology that can facilitate credit transactions without as many intermediaries, there's simply no need to insist on using the outdated system. Yosemite Card is a completely new credit card system that directly connects merchants and customers.”
How Yosemite X Brought The Transaction Fee at 0%?
Yosemite X is cutting the middlemen who were actually responsible for driving the prices so high. Merchants using the Yosemite X card portal won't have to pay the middlemen any costs, and the makers say that they have reduced the transaction fee to one-tenth while the interest rates have been cut down to half.
While traditional players charge you anywhere from 2-3%, the Yosemite X card would only cost you around 0-0.3% transaction fee. The amount saved in the transaction fee is later used to initiate rewards and points to the users themselves.
Howie Bulka, founder of Howie's Artisan Pizza, a Palo Alto-based franchise. says that the incorporation of Yosemite X card has saved them a ton of money which used to add to the cost of their service. He explained why Yosemite X like services are the future of payment systems,
“We started accepting Yosemite Card because we were tired of excessive card transaction fees eating at profits when a better option exists, It's truly exciting to partner with a company driving innovations that streamline our business and save us money, without sacrificing customer satisfaction.”
Yosemite X card has started to roll-out in Palo Alto, California with students from Stanford University, in addition to its existing merchant partners.